Shrinking profit margins?

Fall floral display at Niagara-on-the-Lake, Ont. Want to see gardens? Travel to this little town, also known for the Shaw Festival and its charming B&Bs.

At least once or twice a year we spend a day at Niagara-on-the-Lake (NOTL), taking in the fabulous gardens and a play at one of the Shaw Festival theaters. The gardens change with every season, and the plants always look like they’re on steroids — they grow to be so huge and so beautiful — and the plays are awesome too!

Niagara-on-the-Lake was one of the first local towns to have a booming bed and breakfast business. It’s filled with charming old homes that lend themselves to the short-term stays preferred by visitors seeking a getaway. As the home-share rental business grew through sites like Airbnb and Homeaway, the owners of B&B’s have also found themselves listing on these sites. NOTL is not an inexpensive place to do business in the first place (no matter where your home-share rental is, there is going to be overhead) and now Homeaway, which has been changing its payment rules since it was purchased by Expedia in 2015, is upping the ante.

I just received this message from Yapstone, the company that handles Homeaway/VRBO financial transactions (my husband’s name is on the account):

 Hello Calvin Deyermond,

We are writing to advise you of a change to your Yapstone Advanced Payments feature.  After careful review of competitive payment offerings, we have discontinued Advanced Payments as a free service.  Effective today, your payment account is being converted from Advanced Payments service to Check-In service (See, Yapstone Check-In Payments Terms).  We sincerely apologize for this short notice and appreciate the impact on your cashflow. We know that this is a valued feature of Yapstone and that it distinguishes us from competitors.  So, we have created a quick way for you to resume the Advanced Payments feature.

HomeAway customers who want to resume getting the benefits of advanced payments can do so at a cost of 3% per transaction (in addition to the standard processing fee) for the new service.  By opting into the fee-based service below, you agree to the fees and terms. To opt-in, click the button below.

There are two ways to list on VRBO: Subscribe for $499 per year, or pay 10 percent of pre-tax dollars on each booking. (My suggestion in the book is to project how much you will make over the course of a year, then decide which is more economical.) Now, if you want to keep your cash flow going and receive deposits when the client books, you will pay an additional 3 percent per booking. Ouch!

If you can make your cash flow work, obviously wait to be paid upon check-in and save the 3 percent. If you’re used to Airbnb’s paying you upon check-in, you’ll probably be fine with VRBO changing to the same system. For more tips on the financial aspects of home-share renting, check out Host for the Most!,, and at Talking Leaves Books.

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