A Host's Guide to the Airbnb Cancellation Policy

A Hosts Guide to the Airbnb Cancellation Policy

0:00

/1128.6

1×

For new Airbnb hosts and property managers, choosing the right cancellation policy can feel like a minefield to navigate.

In 2024, Airbnb introduced updates to its cancellation policies, making it even more important to stay informed before your first bookings start rolling in.

In this article we'll walk you through the Airbnb cancellation policy terms and which options will be best for your bottom line.

What Is the Airbnb Cancellation Policy?

Simply, it's a system overseeing booking cancellations for guests and hosts. Airbnb offers several different types of cancellation policies that vary depending on terms and payout. Read on to learn about the different types of cancellation policies and identify which one best suits your business.

The following cancellation options are available from Airbnb:

• Flexible
• Moderate
• Firm
• Strict
• Long-term (Strict and Flexible)
• Super strict (30 Days)
• Super strict (60 Days)
• Discount non-refundable option

An Overview of Airbnb Cancellation Policies

Let's walk through the standard Airbnb cancellation options and exceptions.

Flexible Cancellation Policy

The Airbnb Flexible cancellation policy is the most lenient option for guests. In this policy, guests are eligible for receive a full refund when canceling a reservation at least 24 hours before check-in (local time of the property). Hosts will also lose out on the cleaning fee.

If the guest cancels a reservation less than 24 hours before check-in, they will still need to pay for each night they stay, and 1 additional night. 

If the guest cancels their stay after arriving, they are eligible for a full refund for any remaining nights of the reservation.

Pros:

• Higher ranking in Airbnb’s search engines.
• Greater potential for bookings and keeping your calendar full.
• More flexibility for guests.
• No commitment required from guests.

Cons:

• Hosts are not protected against cancellations.
• Greater chance of revenue loss.
• Hosts take on all the risk.

Moderate Cancellation Policy

The Moderate cancellation policy is the most popular option. It is a bit stricter than the Flexible policy but still gives guests a certain level of flexibility and an opportunity to receive a full refund. For Airbnb hosts, the Moderate policy offers less exposure to cancellations. Under this policy, to receive a full refund, the guest must cancel a reservation at least 5 days before the check-in date.

If the guest cancels within 5 days of the booking start date, the first night of their stay, as well as the Airbnb service fee, will not be refunded. They will also only receive 50% of the booking fees back. If the guest cancels after checking in, they will receive a 50% refund for any remaining nights. However, they will still pay for any nights spent.

Pros:

• Guests can’t cancel at the last minute without financial penalties.
• Hosts are more protected against losses resulting from cancellations. 
• The nature of this cancellation policy may attract more serious guests.

Cons:

• Hosts are still exposed to cancellations within a week of the reservation.
• Hosts will still receive less for the cancellation rebate than for the original booking fee.
• May be hard to find another booking to fill the dates after the cancellation. 

Firm

Under the Firm cancellation policy, guests must cancel at least 30 days before check-in to receive a full refund. This policy then allows a 50% refund if your guests cancel between 7 and 30 days before check-in.

If a guest cancels less than seven days before check-in, hosts will still be paid 100% for all nights booked. This is a great halfway mark between strict and flexible cancellation policies.

As an added allowance, guests are also able to get a full refund if they cancel within 48 hours of their reservation, as long as they cancel it at least 14 days before their check-in.

Pros

• Guests have enough flexibility to cancel within a reasonable time frame, while still being unable to cancel at the last minute without financial penalties.
• Hosts are more protected against last-minute financial losses.
• Hosts are afforded enough time to find a replacement booking if a guest cancels within the time frame.

Cons

• Hosts are still exposed to cancellation losses within a month of the reservation.
• It may be hard to find another guest if the cancellation occurs nearer the 7-day pre-check-in mark.

Strict Cancellation Policy

According to the Airbnb Strict cancellation policy, guests may receive a full refund if they cancel within 48 hours of booking and at least 14 full days before the listing’s local check-in time. After 48 hours, guests are only entitled to a 50% refund regardless of how far the check-in date is.

The guest will also receive a 50% refund if they cancel between 7 and 14 days before the booking begins. They will also receive a refund for the cleaning fee but not the service fee. If the guest cancels a reservation fewer than 7 days in advance, they won’t be eligible for any refund.

Pros:

• Guests are less inclined to cancel a booking due to financial loss.
• Hosts have more time to find a new booking for canceled dates.
• Lower risk of revenue loss from cancellations.

Cons:

• Guests may be less inclined to book a property with this policy.
• Lower visibility in Airbnb’s search results.
• Could lead to a lower overall booking rate.

Long-Term (Strict and Flexible)

The Airbnb Long-term cancellation policy applies to all reservations that are 28 nights or longer. This policy will override your chosen standard cancellation policy once the reservation qualifies as a long-term stay.

Strict Long-Term

Under the strict long-term cancellation policy, your guests will need to cancel within 48 hours of making their reservation to get a full refund, and the cancellation must occur at least 28 days before check-in.

If a guest cancels within 28 days or during their stay, hosts are paid 100% for all nights stayed, and 30 additional nights.

If there are fewer than 30 days left on a guest’s reservation when they cancel, you will receive 100% of the booking fee for those remaining nights.

Flexible long-term

Guests need to give a 30-day notice of cancellation to receive a full refund. If the guest cancels within 30 days of the check-in date, they will still need to pay the first month‘s reservation cost.

Additionally, if the guest checks out early during the stay, the guest will have to pay for 30 days following the date of the cancellation. If there are fewer than 30 days left on a guest’s reservation when they cancel, you will receive 100% of the booking fee for those remaining nights. 

Pros:

• Hosts have plenty of time to find another booking if a guest cancels.
• Hosts receive a full month’s reimbursement if a guest cancels within 28-30 days of check-in.
• Hosts don’t need to spend as much time finding new guests and reservations.

Cons:

• Lower earning potential.
• There’s a greater risk of your property sustaining damage by long-term guests.
• Greater chance of problems arising from longer bookings. 

Super Strict 30 Days

This option is only available to seasoned hosts by invitation only. Under the Super Strict 30 Days cancellation policy, a 50% refund may be issued. However to receive the refund guests must cancel a reservation at least 30 days before check-in. 

If the Airbnb guest decides to cancel when there are fewer than 30 days left until check-in, they forfeit the accommodation fees. Finally, there is no refund given at all if the guest cancels after checking in.

Pros:

• Guests who book properties with this policy are unlikely to cancel.
• Hosts are reimbursed well in the event that guests do cancel.
• There is still plenty of time to find a new booking for the dates if a guest cancels.

Cons:

• Guests may be put off from booking a property with this policy.
• Could lead to a lower overall booking rate.
• Using this policy may create the impression that you are a strict or unfriendly host.

Super Strict 60 Days

This cancellation policy works roughly the same as the Super Strict 30 Days policy. This option is only available to seasoned hosts and it is also by invitation only. The only difference is that the guest must cancel the booking at least 60 days before check-in to receive a 50% refund.

If the Airbnb guest decides to cancel when there are fewer than 60 days left until check-in or after arriving, he/she will receive no refund.

*Both the Super Strict 30 Days and Super Strict 60 Days apply to special circumstances and are by invitation only.

Pros:

• Guests who book properties with this policy are unlikely to cancel.
• Hosts are reimbursed well in the event that guests do cancel.
• There is still plenty of time to find a new booking for the dates if a guest cancels.

Cons:

• Guests may be put off from booking a property with this policy.
• Could lead to a lower overall booking rate.
• Using this policy may create the impression that you are a strict or unfriendly host.

Discount Non-Refundable Option

The non-refundable option lets you offer a discount alongside your existing cancellation policies, providing added protection against cancellations.

With the non-refundable option, you set a discount—typically 10% off the base price (except in China)— that appears in search results to attract more bookings. Guests can choose between your standard rate, which follows your cancellation policy, or the discounted non-refundable rate. If a guest selects the non-refundable option and cancels, you’ll still receive the full payout for the booked nights, minus the cleaning fee if they cancel before check-in. This option is only available for reservations with check-out dates within 60 days and doesn’t apply to bookings made through pre-approvals or special offers.

When Guests Can Book the Non-Refundable Rate

The timing for booking a non-refundable rate depends on your cancellation policy:

• Flexible: Guests can book up until 1 day before check-in.
• Moderate: Booking is allowed up to 5 days before check-in.
• Firm or Strict: Guests can book up to 14 days before check-in.

Special Exceptions:

1. For both reservations made in Italy and reservations made by South Korean guests with a Strict policy the rules are slightly different. If the stay is under 28 nights, hosts can decide what cancellation policies they want to apply. However, if the stay is 28 nights or more, a Long-Term Policy is automatically applied.
2. For hosts in Germany, Airbnb recommends using the Flexible Policy as well as consulting legal advice for specific local regulations.
3. As of July 2024 a new law implemented in California means that a 24-hour free cancellation period is in place. You can find out more details about the types of reservations and how this will affect host payout in this article about the change.

Choosing the Right Policy for Your Listing

Dealing with cancellations is a pain for hosts. They can leave you very little time to find a replacement guest or it means lost revenue. Therefore, you need to choose your Airbnb cancellation option carefully if you want to maximize your bookings.

Choosing the right policy for your business will lower the risk of a dispute that requires intervention from Airbnb’s staff. Depending on your Airbnb management specifics, you might opt for different cancellation policies.

For the majority of hosts, it’s recommended that you select the Flexible cancellation policy. This policy is the one that considers guests’ needs the most. Selecting this policy shows that you are willing to be accommodating and offer free cancellation. Guests will appreciate this and will be more likely to book with you, increasing your overall booking rate.

If you have achieved Superhost status or have many bookings under your belt, the Moderate cancellation policy option might be a good option too. This policy gives a higher chance of you only attracting serious guests who are very unlikely to cancel last minute.

Experienced hosts do not recommend using the Strict cancellation policy. Guests usually look for more flexibility as travel plans might change. Under the Strict cancellation policy, guests won’t get a full refund no matter how long in advance they notify you of the cancellation. Thus, this option is unlikely to help you keep your calendar completely full.

Whatever you decide to go with, it is also possible to change your cancellation policies and adjust your strategy.

Airbnb Host Cancellation Policy

Airbnb strives to ensure a pleasant experience for guests and, therefore, it aims to minimize cancellations by hosts. However, under certain circumstances, you, as a host, might not have other options than to cancel a booking.

If a host cancels, the host's cancellation policy means the fee deducted by Airbnb will depend on timing and the number of cancellations that they have recently made.

Cancellation Fees

As of October 2023, Airbnb lists its cancelation fees for hosts who cancel fees unnecessarily as follows.  Hosts know that calculating cancellation fees is essential to choosing the right policy. The platform will impose fees subject to a minimum cancellation fee of $50 USD. the fee is based on the reservation amount and when the reservation is canceled:

• There is a 50% cancellation fee for the nights not stayed if the reservation is canceled 48 hours or less prior to check-in or after check-in.
• If the reservation is canceled more than 48 hours, and 30 days or less, before check-in, the fee is 25% of the reservation amount
• If the reservation is canceled more than 30 days before check-in, the fee is 10% of the reservation amount

If you need to cancel a reservation or are found responsible for one, Airbnb will deduct the cancellation fees from your upcoming payouts—that’s just how their Payments Terms of Service works. Once you've calculated the cancellation fees, there are a few other things to keep in mind. You won’t receive a payout for the canceled reservation, and if that payment has already been sent, future payouts will be adjusted to cover the difference.

The Airbnb Extenuating Circumstances Policy

• Sudden changes to government travel requirements.
• Government-declared local or national emergencies, epidemics, and pandemics.
• Travel restrictions imposed by a governmental agency that prevents or prohibits travel to or from a listing’s location (this does not include travel advisory warnings).
• Military action or other hostilities.
• Natural disasters. 
• Unauthorized parties or events. 

If something comes up and you can’t honor a booking, it’s best to cancel as soon as possible so your guests have time to make other plans. If you need to cancel within 24 hours of check-in, though, you won’t be able to do it online—you’ll need to reach out to Airbnb directly for help.

Airbnb Guest Refund Policy and Cancellations

Directly related to the Airbnb cancellation policy is the Airbnb refund policy. The Airbnb refund policy identifies scenarios or issues in which guests are eligible to receive a refund. There are several situations where guests may be able to receive a full refund from Airbnb:

• Inability to access the accommodation — A host cancels the booking within 24 hours of check-in, changes the reservation details without the consent of the guest, or fails to provide the keys or access code for check-in. 
• Incorrect or inaccurate listing details — The information contained in the listing description was incomplete or inaccurate. This could relate to the property’s size, location, number of bedrooms, and amenities. It could also relate to listed amenities and appliances that don’t function as they should or are broken. 
• Health and safety concerns — The accommodation has not been cleaned or contains health and safety hazards, or houses pets or animals that the host did not disclose beforehand. 
• The guest needs to cancel because of a Major Disruptive Event

If a guest encounters any of these situations, they need to submit a claim to Airbnb within 24 hours. Airbnb will make the final decision about whether or not the guest will be reimbursed or booked alternative accommodation. 

Guests will need to provide evidence supporting their claim, such as photos, videos, and other documentation. They will also need to provide evidence that they tried to contact the host and resolve the matter directly. Airbnb will then review the claim and respond to the guest with their decision. 

Major Disruptive Events

As of March 2024, Airbnb has made a change to its policy regarding Major Disruptive Events. This policy is here to help when major unexpected events—like natural disasters, government travel restrictions, or severe weather—affect a guest’s ability to travel. In these situations, it steps in to override the host’s usual cancellation policy, allowing guests to cancel eligible reservations at the impacted location for a refund. It also looks out for hosts by letting them cancel affected bookings without a cancelation fee or penalties.

Conclusion

While choosing the right cancellation policy is important, guest satisfaction will always be your best insurance. Being communicative and efficient will always work in your favor and one of the best ways to do this is through automation.

Vacation rental software, like iGMS, can automate a bunch of your routine hosting tasks, allowing you to focus on growth and scaling.