THE VIEW FROM HERE - Similar to how we call all tissues, Kleenex, and all acetylsalicylic acid Aspirin, we tend to call all short-term rental agencies Airbnb.
Many companies make tissues and several manufacture acetylsalicylic acid and more than one company provides no-line booking services for “short term rentals.” Two others are Vrbo (HomeAway) and Booking.com.
‘Short Term Rental” is the opposite of hotel or resort rental such as going to a Hilton Hotel or resort spas. A short-term rental is either a house or apartment which historically would rent out on month to month or a yearly basis. A short-term rental can be as short as one day; sometimes it is only one rooms in someone’s home. Short-term rentals have no hotel services.
One thing which Airbnb, Vrbo and Booking.com share is predatory business practices. While this article focuses on Booking.com’s treatment of the homeowners, one should not assume that owners will not face a nightmare dealing with Airbnb and Vrbo.
Booking.com, a subsidiary of Booking Holdings, is a Dutch online travel agency headquartered in Amsterdam. Hotel bookings seems to be its main business and its entry into the short-term rental market seems to be an ad-on, for which they have failed to develop any decent software. What Booking.com lacks in a decent computer system it makes up by treating the homeowners like trash.
There is perverse wisdom in Booking.com using predatory business practices against owners, while catering to the guests; the guests pay the money. The owners (often called “hosts,” which is a misleading name since they seldom provide any host services) provide the properties and there seems to be a glut of owners wanting to rent out all or parts of the houses or apartments. Unlike Bed and Breakfasts (B&B), owners seldom provide meals, but the kitchen may have some elementary food staples. Since owners are a dime a dozen and raking in the guests’ money is Booking.com business model, owners fare quite poorly.
Abusive Business Practices
The predatory behavior starts with Booking.com’s webpage to solicit owners Booking.com Partner Hub, How does Booking.com work for property owners? For example, it states, “That way, you [Owner] have full control over your rates and availability and can offer guests more transparency on your house rules, policies, and overall offerings.”
False. Booking.com decides what goes on the owner’s page, and if it does not like the owner’s requirements, it omits them. For example, if the owner has a five (5) day minimum, Booking.com omits that from the owner’s page. The result is that many potential guests book for less than five days. (In contrast, Airbnb and Vrbo do allow owners to write out all their requirements).
The claims that the owner has control over rates and availability is an illusion when Booking.com books guests contrary the property’s availability. Booking.com’s excuse for omitting the five-day minimum is that there will be more bookings for a shorter period of time and Booking.com will make more commissions. Also, Booking.com does not honor a vacant “turn-over” period between availabilities. Because private homes are not like a Hilton Hotel with a staff to change all the linen and clean a room as soon as a guest leaves, owners need time to wash the linens, remake the beds, clean the property in order to prepare for the next guest. Some homes are quite large and require considerable time and energy, but Booking.com makes no allowances. Its business model apparently wants to have maximum bookings without regard to whether the owners can turn over their house that fast.
Booking.com also states, “It’s important to remember that the agreement is made directly between you [owner] and the guest.” This statement is materially misleading, when Booking.com imposes its own terms on the rental. Without mutual assent between the guest and the owner as to all material term, no contract is formed.
Booking.com’s Faux Conversations Feature
When someone has booked a Property, Booking.com creates webpage which includes a feature, Conversations with Guest. Thus, an owner believes that he can email the guest to advise the guest that the property is not available for less than five days. After an owner sends the email, the Booking.com page says “Delivered.” Booking.com fails to mention that it censors emails and often does not deliver the email to the guest who remains unaware of the problem. Not only does Booking.com not allow the Guest and Owner to make an agreement based upon terms mutually agreeable to both, but it prevents the owner from discussing problems with the guest. Sometimes, an owner may waive a requirement, or the guests may decide that the property does not meet their expectations. Booking.com censorship appears to be a tortuous interference with the contractual rights of the parties.
Booking.com has another feature which makes its statement, “the agreement is made directly between you and the guest,” a lie. Booking.com refuses to let owners reject a guest or mutually modify any aspect of the agreement. For a contract to be valid, both parties have to know all the material terms, and they also must have the contractual right to amend or rescind the agreement.
How To Make A Reservation Work Despite Booking.com’s Misrepresentations
There are two basic ways to overcome Booking.com’s predatory behavior. (1) The owner locates the guest via a Google search, (2) The guest sends a message which Booking.com censors allow to be transmitted. It seems that the owners’ response is not censored (until Booking.com closes this glitch).
The Google Contact: This does not always work. It is best when the guest’s name is unusual. When they can be contacted and the problem is explained, the situation can be resolved. Sometimes, the guest would like to stay more days and does not mind increasing the length of visit. Other times, the guest may have a special need, e.g., a funeral, or other unique factor and the owner can waive the requirement. Other times a requirement cannot be waived, e.g., when there is a swimming pool or other dangerous feature, no children under 12 may be allowed. Not everyone can be found via Google.
The Guest Contact: If the guest includes a phone number or email or some identifying information, e.g. “we will be flying out of Boise, Idaho,” the owner can find the guest via Google. There can be no mutual assent and hence no contract when the two parties are prevented form communicating and learning the material terms. In our humble legal opinion, Booking.com’s owner’s page starts Booking.com down the path of Unfair, False and Deceptive Business Practices in violation of California’s Unfair Competition Statute, Business and Professions Code, § 17200
It Gets Worse
For reasons which defy comprehension, Booking.com does other inexplicable things.
- False cancellation of a reservation: Booking emails that the guest has canceled a reservation two days before arrival. False! The guest had not cancelled. When the owner called the guest and asked what happened, the guest said he did not cancel, and his kids were counting on visiting Universal Studies. It was agreed that the guest would pay cash upon arrival. If Booking.com did pay the rental after the guest had left, the owner would Zelle the money to the guest. The guest came, he paid, and Booking.com did not pay the rent nor did it make any refund to the guest. It took the guest almost a month and the involvement of his attorney to receive his refund. Then Booking.com sent the owner a bill!
- Removal of Guest for Future Guest List
Booking.com removed a future guest from the Future Guest’s list. The owner sends several emails to the guest but gets no response. The owner cannot locate the guest who lives in France. After 4 or 5 emails thru Booking.com, the owner makes other plans. The day before the original date, Booking.com says the guest will arrive the next day. Not only was the house not prepared for any guests, but the owner had also taken that gap in bookings to make maintenance repairs.
Booking.com tells the owner that it is charging the owner the extra cost for the guest to find alternative lodgings. Then, the second day of the guest’s prior booking date, Booking sends an email that no one has been able to contact the owner and the guest will arrive that day. This nonsense email was after there had been about 20 emails between the guest, Booking.com, and the owner.
Perhaps, Booking.com does alright with hotel bookings, but when it comes to Short-term Rentals, it seems to be one predatory business practice after another.
(Richard Lee Abrams has been an attorney, a Realtor and community relations consultant as well as a CityWatch contributor. You may email him at [email protected]. The opinions expressed are those of Mr. Abrams and not of CityWatch.)