Millions of vacationers are turning to internet-based rental marketplaces such as Airbnb and VRBO as a way to keep costs down. A 2016 survey by Hipmunk found that travelers could save 40 percent or more by booking a home or apartment rental rather than a hotel room in some popular cities.
The online housing rental industry has grown by nearly a quarter in the past two years, hitting $10.6 billion in revenue, and it’s expected to hit nearly $14 billion by 2021, according to research firm Statista. The firm projected that more than 16.1 million people would stay in a vacation rental booked online this year.
“Vacation rentals are the fastest growing segment of the travel industry,” says HomeAway.com travel expert Melanie Fish. “It’s gone from being an alternative form of accommodation to just being the way that we travel.”
Most of the time, such arrangements work out well, but when you’re renting from an individual rather than a business, there’s more potential for misunderstandings, miscommunication and, unfortunately, outright fraud. If you plan on renting a vacation home online, follow these steps to make sure you’re financially protected:
1. Do your research. Especially if this is your first time booking a vacation rental, plan to spend more time selecting your accommodations than you would for a hotel. Every property is different, so you’ll need to look closely at photos, descriptions and locations in order to properly compare rates between homes.
2. Get a feel for the owner. Typically there’s some back-and-forth with the landlord before you book a vacation home rental. Use this as an opportunity to negotiate on price, and also to ask about specifics that might not be clear in the listing. A home that’s “walking distance” to town, for example, could be two minutes away or 20. If you don’t see a must-have an amenity like air conditioning or Wi-Fi availability on the listing, ask the owner whether that’s provided. Keeping all communications through the listing platform will give you recourse later if you something turns out to be untrue.
The landlord should be responsive and friendly during these initial interactions. If he’s not, that could indicate future problems.
3. Read the fine print in the contract. Vacation rental contracts can vary, so take a close look at the contract when you’re signing it. In particular, look for potential fees that could drive up the total cost for the stay; any potential unreasonable requirements that could cost you your security deposit; and policies and around parking and occupancy.
You should also make sure you understand the cancellation policy. They vary greatly from rental to rental and can be extremely strict for high-demand rentals, and tough to get out of if you change your mind.
4. Pay attention to customer reviews. Look for a property with five or more customer reviews. This will ensure that you’re staying with an experienced landlord and give you a sense of how others have fared on the property. You can overlook one or two negative reviews, but look for an overall pattern that indicates whether guests have had a good experience there. “If a listing has more than 50 reviews and a five-star rating, there’s probably no additional risk to stay there than to stay at a hotel property,” says Scott Shatford, co-founder and CEO of Airdna, which provides data and analytics to vacation rental entrepreneurs and investors.
Experienced travelers who are willing to risk a rookie owner can get a deal going with a newly listed, review-free owners. Shatford says that you can get up to 50 percent off a stay from an owner who is trying to build up his credibility.
5. Always use your credit card. Since most vacation rentals are booked online these days, it’s less likely that you’ll be asked to pay with a check or credit card -- and you should avoid doing so in any event. When booking online, opt to put the payment on your credit card rather than your debit card. Credit cards offer more protection against fraud than other forms of payment, and in the case of a dispute typically won’t require payment until it’s been resolved. (Exception: If you already have a balance on your credit card that you can’t pay off any time soon, it may make sense to use a debit card to avoid paying interest on your vacation.)
If you’re staying abroad, you’ll get the best possible exchange rate by using a credit card, just be sure to use one without foreign transaction fees. Finally, if you have a travel credit card, spending on vacation home rentals may qualify for additional rewards points.
6. Contact the listing site if issues arise. If you find issues with the property after you arrive that aren’t quickly resolved by the landlord, contact the listing site. Airbnb, for example, promises to refund or rebook travelers who can’t get into their listing or find a property that’s unclean, unsafe or has been misrepresented.
7. Keep an eye out for common scams. Most problems that arise with vacation rentals reflect a misunderstandings such as a property that doesn’t live up to its description or complaints about a landlord’s responsibilities. Occasionally, however, outright criminals use vacation rental listings to bilk potential travelers out of their savings.
Here are a few signs that a listing may not be legit:
- You found it on an online classified site. Stick with known quantities like Airbnb or HomeAway.com, which vet their landlords and offer customer service and protections of their own. Scammers will often steal photos and text from these sites to post elsewhere.
- The price is out of line with the market. If it’s too good to be true, it probably is.
- You’re having trouble getting answers. The true owner of a property will have no trouble giving you specifics on details like water pressure or outside noise.
If you think you were the victim of a rental scam, contact your credit card company, the website where you found the listing, and the Federal Trade Commission.