new to AirBnB - pricing advice needed

[Steven Skarupa]

So, I'm about 2 weeks away from finishing my 50K rehab of a small bungalow just north of Cape May New Jersey.  This area is ripe with BnB's and according to the research I did when I purchased the home (2/1 being renovated into a 3/2) in Feb, rentals will average about $250 - $350/night with about a 50% annual occupancy.  In addition, there seems to be a major shortage in available rooms this summer so the area is totally booked for the remainder of the summer.  Since I'm about to list on AirBnB/VRBO, I'm wondering about pricing and could use some experienced advice.

I had planned a strategy where I would undercut the price for the first 5-10 renters to gain positive reviews and over pamper/attend to them to ensure positive experiences.   Then I would bump the prices back up to market after that.  But now I'm starting to wonder if I need to bother.   I think the positive reviews/experiences initially are super important but I'm also starting to think that I should go ahead and set the price at market to begin with.   With this level of renovation, the money is flying out of the account at an incredible rate and I'd really like to start getting returns.   

What would you do?  Stick with a slow-burn-to-start strategy?  Go with market price from start?  Go above market, since there is a shortage?

TIA!

-Steve

[Joshua Strickland]

I’d go with market price and adjust from there. I’d also highly recommend a pricing tool. Pricelabs is my favorite. Very customizable and cheap.