Fair STR cleaning fee?

Question

Hi, all. I have a nice 3br/2ba condo in Nashville, TN. The unit is 1130sf. Our cleaners charge $175 per cleaning - this includes linen service so they can flip the place pretty quickly without needing to do much laundry. My property manager has our cleaning fee set to $260 per stay.

This appears to be high in my local research of comparable properties, so I'm considering addressing the need to reduce this price to guests, and cost to us. I'm ok not making a profit on the cleaning fee, which would put us charging $175 to the guests. Rates are currently $200-500/night with a 2 night minimum.

Thoughts on these costs from anyone with experience comparable market?

Jason Reece · Answer

Thanks everyone for your replies. I got this back from my property manager when I told him I wanted to lower the charge to $175. I appreciate that he's structuring the costs in a way that avoid inflating his commissions. However, I'm not sure if this $175 is expensive considering the inclusions mentioned at the of his reply. I welcome any comments:

"The cleaning fee is $175.  That includes towel & linen rental, off site laundry and basic consumables.AirBnB also lumps in the Limited Damage Waiver ($59) and Hotel Occupancy Tax (5%) and AirBnB listing fee (3%) to the total "cleaning" cost paid by guests.

175 + 59 = 234 x .05 = 245.70 x .03 = 253.07  (Rounded to $255)

The good news for you - These are all expenses that must be paid.  We just charge them to the guest, rather than deduct from the owner's take.  Plus, if we raised daily rental rates by that amount to offset - You would lose another 20%, because we base our commission on daily rental rate (which doesn't include cleaning).  This is why we pull as much expense out as possible before the daily rate is calculated.  This allows you to pay commission on the lowest amount.I understand that $255 can look off-putting.  Ideally, AirBnB would be more transparent on what all that covers.  But - At the end of the day - We want the guests to pay those costs, not you."

Luka Milicevic · Answer

@Jason Reece That's quite high on both ends.

I'd expect something that size to cost about 120-150 for a cleaning crew including linens.

I'm paying around 110 for that size, but on a triplex so it's going to be cheaper.

For the actual fee you charge guests, I would still maybe keep some margin but 260 is quite high. I think you should be in the 200-220 range.

This is all just me guessing based on the info you provided.

Sharlene Mulchandani · Answer

@Jason Reece If your cleaning fee appears to be high in your research with comparable properties, then I would definitely only pass on the $175 cleaning fee to your guests and not make any profit on the cleaning fees. $260 dollars does seem pretty high for cleaning fees in my opinion.

Tracy Streich · Answer

Each market is different.   Sounds like you have done research.   Your manager needs to make money on the rental and not the cleaning fee.   Higher cleaning fee means lower bookings.

Randall Barrett · Answer

Hey Jason!

I would agree that that fee seems high. We co-host 2 single family properties that are 3br/2ba they are around 1500-1700 sq foot.

Our cleaning fee to guests is $149 and $165 (slightly larger unit). Our cleaner charges $90 for one and $149 for the larger house. Also, our nightly rates are set as $200 minimum. The occupancy for these homes have been low around 35-40%. We've been trying to fine tune the rates as well as getting the owners to invest into more amenities to make their homes more competitive/desirable.

We own (3) 2 bed 1 bath apartments around 700 sq ft that perform way better. 75-90% occupancy. Our rates are obviously lower, but I feel like the larger homes are possibly more competitive right now.