New VRBO Fees

VRBO Pay-Per-Booking Fees Increase

David Wallace, TurnoverAngel

What's Happening?

Effective October 29th, all listings who currently pay the 5% VRBO PPB fee on their gross booking revenue will start paying the new fee of 12%.   Bookings received before that date but checking in beyond that date, will still pay the old 5% rate.  Listings on an annual subscription which many of our owners are, will be able to accept bookings under that agreement (no PPB) until the annual agreement expires. VRBO has no plans to offer renewals of those plans.  As if I didn't have enough accounting work!  LOL

How does this affect TurnoverAngel Owners?

TurnoverAngel will initiate a pricing increase accross all listings to ensure we don't have a sudden drop in net income.  We will be monitoring all listings and observing very closely year over year trends to look for any impact on prices and occupancy rates.

What does this mean for the broader market and future outlook?

In the last few years we've seen so many software companies increase their subscription fees, from Quickbooks, to Netflix, to Airbnb and VRBO.   Some of these companies like quickbooks sell purely software which is being rapidly cloned and reverse engineered by the flood of AI bots.  Good luck to them.   Others, like Netflix, Airbnb, VRBO, Amazon, have vendors on one side of their software and customers on the other.  They will be a little more resilient because there is a finite supply of their product: listings.  Their value add is 2-3 things, 1) A Unified Market/Checkout for Humans who don't have time to visit 500 websites to look for a product or book a vacation, 2) Abitration of Disputes between Customer and Vendor, and in some cases 3) Delivery of the product to the customer via physical or digital networks.

I am strongly convinced that most shopping for products, services, and short term rentals will be done by personal AI bots.  Not AI built into every website (GAG!) - your personal "Jarvis" doing all the research and negotiation for you.  This will make the value of having a one-stop market for humans with limited time to browse, lower.  This will follow a arc trajectory where they raise prices, stop raising for awhile and then lower them.  I don't actually expect large companies with share holders to lower prices - but their future replacements will enter the market - cater to AI shoppers through MCP's, API's, CLI's (tools AI can use) and take market share.   

When will this trajectory unfold?  

The human mind is software and it is difficult to update.  New routines and new skills take time to form.   The delay will come from human psychology - not the availability of the technology.   Expect siginificant change over 5 years as our brains are rewired over time.  There will be hold outs who decline to switch to the new tools and pay more.  It's important to remember, there was a time when VRBO was #1 and Airbnb was a single airmatress in a single apartment.  Real estate, like hot dogs in a baseball stadium, is a local and finite comodity and therefore has pricing support.  The north idaho short term rental market will continue to thrive.