If you’re new to the short-term rental industry, there may be some words you’ve heard thrown around that you just aren’t familiar with yet. Do not fear! We’ve compiled many (if not all) of the terms related to short-term rentals you may hear as you set out to start your new venture. Save this post so you can easily refer to it when you hear a term that might be new to you!
Host Tools provides an automated, unified calendar for short-term rental hosts, allowing you to seamlessly list on all major channels. Start your free trial today!
Your vacation rental dictionary
Average daily rate
The average daily rate, or ADR, refers to the average amount of income you make per day on your rental. The ADR is helpful in determining if you’re over- or under-pricing your listing.
Booking channels
You want to have your home listed on multiple booking channels. Booking channels refer to the different places your home is listed, like Airbnb, Vrbo, Booking.com, your own direct booking website, etc.
Cancellation policy
In the travel industry, plans change all the time. Hosts have the ability to set different levels of cancellation policies. Some are more forgiving and allow full refunds, while others do not.
Cleaning fees
Many hosts choose to charge a cleaning fee to guests to help offset the cost of frequent turnover.
Dynamic pricing
This is a pricing strategy that evolves with market demand. For example, nightly rates will typically be higher during a busy season and lower during the off-season.
Guest screening
Guest screening is the process that you or a platform like Airbnb does to “screen” a guest before booking. This typically includes checking past reviews from guests, confirming their identity, and making sure they agree to your house rules. This helps ensure you know who is actually staying in your home and is a tool to prevent parties.
Hospitality taxes
Some regions require hosts to charge and remit local taxes on behalf of their guests.
House rules
These are the “rules” you’ve set in place in your home. They are things like check-in and check-out times, quiet hours, smoking policies, etc.
Insruance
Hosts should invest in insurance that is specific to short-term rentals. These plans cover things that are specific to the needs of hosting guests.
Instant book
Instant book refers to a guest’s ability to book a reservation with an immediate confirmation. This bypasses any guest screenings.
Listing optimization
Listing optimization refers to making sure your listing looks as excellent as possible with good photos and a strong description. It also refers to making your listing SEO-friendly so that your home “ranks” higher on searches.
Minimum stay requirements
The minimum stay requirements are the minimum number of nights a guest must rent out the property. For example, many hosts choose not to allow single-night stays due to the increased risk of parties and turnover costs. That said, some hosts still do allow one-night stays.
Property management software
Property management software, like Host Tools, is a digital dashboard that helps you manage your property. Host Tools, for example, lets you automate guest communication, cleaning schedules, smart lock codes, and more.
Occupancy laws
These refer to the local and national laws regarding how many days a rental can be rented out per year, zoning requirements, and other regulations.
Occupancy rate
Occupancy rate refers to the percentage of your property that is booked out of all the available time it could be booked. For example, if you allow rentals 100 days out of the year, and 80 days were booked, your occupancy rate is 80%.
Revenue management
Revenue management is the active strategy you have in place for handling your income and expenses. This includes how you’re pricing your listing and optimizing based on seasonality and demand.
Security deposit
A security deposit is an additional monetary amount you take at the time of booking to cover any damages from the guest. In most situations, the security deposit will be returned to the guest upon check-out, provided there is no damage to the rental.
Short-term rental
You may have previously only heard these properties referred to by brand names like “I’m renting an Airbnb” or “I’m starting a Vrbo”. These are brand names. What the actual rental property is referred to as is a short-term rental or STR.
Superhost status
5-star hosts can earn Superhost status on Airbnb. This coveted status gives you a special badge that shows guests you are a top-tier host. This helps your home appear higher on search results, and also when guests filter for “Superhost” on Airbnb.
Turnover service
Turnover refers to your cleaning crew. These are the cleaners that you’re automatically scheduled with Host Tools to show up and clean the property between guests.
Vacation rental agreement
A vacation rental agreement is a legal document that outlines the terms and conditions of a stay between a guest and a host.
Now that you’ve got a solid grasp of the terminology, you’re already one step ahead in your short-term rental journey. Whether you’re setting your pricing strategy, optimizing your listing, or navigating guest interactions, this dictionary is your go-to resource as you grow. Keep it handy, keep learning, and most importantly—enjoy the process of building a successful and rewarding vacation rental business. Learn even more terms in our vacation rental glossary.
Host Tools provides an automated, unified calendar for short-term rental hosts, allowing you to seamlessly list on all major channels. Start your free trial today!
