USA TODAY International Edition
Expectant Airbnb, Vrbo guests fighting for refunds
Rental services’ unique models muddy the issue
Evan Skowronski was supposed to stay in a Connecticut Airbnb this month with his wife after booking their stay in January.
Because of the coronavirus pandemic, the couple opted to cancel their trip in April. Skowronski, 53, a scientist working on infectious disease surveillance, canceled the booking outside of the company’s extenuating circumstances policy, which promises refunds or travel credits. He had been caught up in a back and forth with the company and his host in an effort to receive a refund, only just receiving it Thursday.
And Skowronski is far from alone as travelers and hosts from short- term rental platforms like Airbnb and Vrbo have been stuck battling for their money back.
The coronavirus pandemic has prompted many U. S. travelers to rethink their travel or cancel it entirely, leaving airlines, cruises and hotels on the hook for refunds or travel credits. Short- term rental services’ unique models – where both hosts and guests exchange money on the platform – have created a complicated refund issue.
In booking short- term rentals, travelers assess a listing of homes then book available dates from hosts. In the event guests have to cancel, they must abide by certain policies. As the pandemic unfolded, companies had to make choices about how to handle refunds and whether the companies, the hosts or guests would be on the hook.
For customers of short- term- rental giant Airbnb, a cash refund requires documentation explaining why guests can’t travel as a result of COVID- 19, such as a link to a government site or a letter from a medical professional.
Airbnb spokesman Charlie Urbancic told USA TODAY in a statement: “Once COVID- 19 evolved into a global pandemic, we updated our extenuating circumstances policy to allow guests to cancel and receive a full cash or credit refund – including all our fees – for eligible bookings made prior to March 14. We made this decision because we firmly believe that travelers should not have to choose between safety and money.”
Both guests and hosts have aired their grievances on social media as they grow dissatisfied. But travelers could also resort to arbitration or attempt other legal action as they grapple with the financial fallout.
Airbnb’s cancellation policy
When the pandemic happened, Airbnb had more than $ 1 billion worth of cancellations, CEO Brian Chesky told USA TODAY. The company made the choice to override its host cancellation policy to offer refunds to guests, which prompted an intense backlash from hosts.
“We did not want guests to feel like they were compelled to travel, putting themselves in harm’s way because they weren’t going to get a refund,” Chesky said of the choice. The company offered an apology and $ 250 million to its hosts, which Chesky said wasn’t enough to cover what they would’ve earned but was the most they could do. Airbnb also created a relief fund for its Superhosts, which is up to more than $ 17 million.
But a closer look at Airbnb’s policy reveals it has made changes over time, Teel Lidow, CEO and head of product at
FairShake, which assists consumers with arbitration forms and processes, told USA TODAY, hedging language promising guests full refunds.
Right now, Airbnb’s policy covers guests with stays through July 31.
Vrbo’s cancellation policy
Vrbo’s policy applies to bookings made before March 13. It has extended the policy until June 30 to bookings canceled due to government restrictions ( which vary widely by city, county and state).
Travelers outside the cancellation window can receive a full credit to be used within the next year. But if travelers are not eligible for a 100% refund and doesn’t accept credit, hosts are encouraged to give at least a 50% refund.
The company has taken a different approach than competitor Airbnb, which has played intermediary when travelers and hosts can’t work out the refund. If Vrbo hosts and travelers don’t reach a resolution, the host is subject to penalties.
“Ours has been more of a balanced approach, trusting our partners to do what’s right and providing rewards and repercussions on both sides of that equation,” Vrbo president Jeff Hurst told USA TODAY.
Janice Kercheville, a 60- year- old retiree from Aurora, Colorado, was set to stay at the Marriott Desert Springs in Palm Desert, California, in March. Her group had to cancel due to coronavirus concerns because several in their party were high risk. She never received a refund.
“Ultimately the management company that handled the rental for the owner offered me a week in one of their other resorts, usable within six months, but that has basically no value because my group of friends are still not comfortable with travel and the additional risk of exposure to COVID,” Kercheveille told USA TODAY.
What consumers can do
Whenever you sign up with Airbnb or Vrbo – or most companies, really – you sign a contract, Lidow said. That contract may include a clause that says how you dissolve disputes with the company.
Generally, guests need to go through arbitration – a small- claims- court- style proceeding, usually done over phone or email – and explain what went wrong. The company responds, and the arbitrator issues a binding decision.
But it’s unclear whether Airbnb’s policy changes throughout the pandemic would hold up: “It’s really a untested question whether the changes that they made to their policies and their contract after COVID- 19 happened in response to COVID- 19 are binding in any way,” Lidow said.
Both hosts and guests are filing claims due to the COVID- 19 cancellation policy situation.
Lidow said the company has more than $ 3 million worth of Airbnb- related claims it’s helping with from hundreds of hosts and guests, and thinks it’s the “tip of the iceberg.”
Lidow said it’s an uphill battle for those seeking refunds from short- term rental services outside of the cancellation policy coverage windows.
Skowronski has a week- long stay in Europe booked in October for his anniversary with his wife. He booked it with – you guessed it – Airbnb, which is only covering stays through July 31. Time will tell if he’s out more than $ 1,000: “Who knows whether that’s in the wind or not?”