A few days before flying to Bali, Indonesia, I received an unexpected email from Airbnb: My host had sold my vacation home. “We’re reaching out with the unfortunate news that your reservation was canceled,” it said. “Your refund is on its way.” But wait — I didn’t want my money back. I needed a place

This type of vacation rental cancellation is on the rise.A few days before flying to Bali, Indonesia, I received an unexpected email from Airbnb: My host had sold my vacation home.

“We’re reaching out with the unfortunate news that your reservation was canceled,” it said. “Your refund is on its way.”

But wait — I didn’t want my money back. I needed a place to stay while I was in Indonesia. Airbnb assured me I had nothing to worry about. It would find a new rental and cover my extra expenses. But, as always, some restrictions apply.

Sales cancellations are on the rise.

Insiders say selling a vacation rental out from under a guest is becoming a big problem. There are no statistics on the number of vacation rentals with active reservations currently for sale. However, Justin Gordon, who runs the rental price comparison site HiChee, says more hosts are putting their rentals on platforms like Airbnb and Vrbo while they wait to sell their properties. He’s seen the disruption it causes guests about to leave for vacation.

“I felt so sorry for the guests,” he says.

Did I mention the Indonesia rental? That wasn’t my first cancellation. A few years ago, I rented a condo in Oahu through Vrbo. A week before I checked in, I got an email saying my stay had been cancelled because the property was sold.

“Many homeowners are investors, buying properties low and selling high or holding them for a set number of years as a part of their financial strategy,” explains Matthew Deal, managing director of Element Vacation Homes, a central Florida vacation rental company.

A cancellation can have consequences for the seller. For example, if you list your home on Vrbo, you might have to pay the platform a cancellation fee, which increases as your arrival day approaches.

“In addition to financial penalties, repeat offenders may see limited search visibility on the Vrbo app and site, temporary suspension, or revocation of their Premier Host status,” says Nola Lu.

Airbnb has similar restrictions. “We expect Hosts to honor accepted reservations,” says spokesman Aaron Swor.

What are your rights when your vacation rental is sold?

If your vacation rental is sold before you arrive, you have some rights — though not as many as you’d assume.

  • For rentals booked directly through the owner, your rental contract will outline your right to a refund. If you’re dealing with a host who has only one rental or can’t accommodate you at a different property, you’ll get a full refund, but you’ll have to start over and find a new vacation rental. Pro tip: Use a credit card to book. You can always dispute the charges if the owner flakes out and tries to keep your money.
  • For rentals booked through a popular vacation rental platform like Airbnb or Vrbo, the platform will offer a full refund or accommodate you at a different rental property. If there’s a price difference — and there usually is — then the platform may offer to cover the extra cost.
  • If you booked through a property management company, your rights may not be spelled out in your contract, but chances are the company will have a plan “B” ready. For example, Element Vacation Rentals has a policy to promptly present multiple options to displaced guests, including comparable properties from its portfolio and those of its competitors. Ask about the policy before you make a reservation.

At least, that is what’s supposed to happen if there’s a cancellation. But let’s talk about what does happen.

What if an owner sells a vacation rental?

You’ll probably feel confused and upset when an owner sells your vacation rental from under you. And even as you’re processing the loss of your rental, your host may ask you for a favour.

When Gerri Detweiler’s Airbnb rental owners sold their place, her host asked her to cancel the rental. The reason? The host didn’t want to incur an Airbnb fee. So Detweiler, a personal finance expert from Sarasota, Fla., cancelled the stay.

“I didn’t bother booking another rental with Airbnb,” she says.

I had no choice regarding either of my cancellations. I was only days away from checking in.

To their credit, both Airbnb and Vrbo helped me. Vrbo found a new rental in Hawaii and covered the price difference. Airbnb offered a coupon and sent me a few options for a replacement rental in Bali. The only one available on such short notice was thousands of dollars more than my original rental, so Airbnb increased the amount of the coupon to cover the extra cost.

The difference between the platforms was in their approach to the situation. Vrbo transferred me to a particular team that took care of everything quickly. With Airbnb, it felt like more of a negotiation. But in the end, I was grateful to have the protection of both vacation rental platforms.

This could happen to you.

This isn’t an abstract issue. Two of this year’s hottest housing markets — Orlando and Tampa, Fla. — are popular with vacation renters and likely to have many homes.

But that’s not the real problem. Most vacation rental customers don’t know their rights when they rent. They either assume they have no choice but to take the refund and are alone. Or they believe the vacation rental company must find them a comparable rental and cover any price difference.

But you’re not on your own unless you rented directly through an individual—and even then, the previous owner may be able to refer you to another rental. Your vacation rental platform won’t automatically find you a new place and pay for it. You may have to negotiate.

The best solution is disclosure. Vacation rental owners should tell you if their property is for sale. Then, you can make an informed decision about whether you still want to rent the place—and take your chances.

Elliott’s tips for avoiding a vacation rental cancellation.

Getting surprised by a vacation rental sale is preventable. Here are a few strategies:

Talk to the owner.

Before you rent a vacation home, ask if the place is for sale. If it is, ask what would happen if the unit were to be sold. Talk to the new owners if it’s sold,” says hospitality consultant Steve Turk. “See if they’ll honour your reservation.”

Read the reviews — all of them.

If renting on a popular platform, don’t just skim the reviews. Read them. Hosts sometimes stop caring about their rental unit if they know they will sell. “Check to see if recent guests have posted any negative reviews,” advises Pete Evering, a business development manager at Utopia Property Management, a rental management company.

Do your research.

If you have the rental address, run a quick online search. If it shows up on Zillow or Realtor.com, you know you have a problem. Gordon from HiChee is considering developing technology that would notify travellers in case their booked rental shows up for sale on the internet.

 

 

 

Written by: Christopher Elliott

 

 

BIO:
Christopher Elliott is an author, consumer advocate, and journalist. He founded Elliott Advocacy, a nonprofit organization that helps solve consumer problems. He publishes Elliott Confidential, a travel newsletter, and the Elliott Report, a news site about customer service. If you need help with a consumer problem, you can reach him here or email him at chris@elliott.org.

 

 

 

 

 

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