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How Hospitable Determines Your Dynamic Pricing Rates

Understanding the data behind your property's automated pricing

Kelly avatar
Written by Kelly
Updated this week

Hospitable's Dynamic Pricing utilizes data analysis from multiple sources to optimize your nightly rates based on multiple factors specific to your property and market. This article explains how we calculate both your base price and the adjustments that create your final nightly rates.

How We Calculate Your Base Price

Your Base Price serves as the foundation for all dynamic pricing calculations, and it's what adjustments are added to and/or subtracted from. The Base Price is tailored specifically to your property and changes over time based on:

Property and Market Characteristics

  • Physical attributes: Unit type, number of bedrooms and bathrooms, maximum number of guests

  • Location factors: Your property's specific area, neighborhood, and proximity to attractions

  • Amenities: Parking, pools or unique views, for example

  • Fees: Such as a security deposit, extra guest fee, and/or cleaning fee

  • Performance in the market: Your property's historical performance, as well as that of the market

  • Guest experience: Your aggregate guest review score

  • Various other factors


Price Adjustment Factors

Once your Base Price is established, several independent adjustment factors are calculated and applied.

What Are Price Adjustments?

Adjustments are added to or subtracted from the base rate based on various changing factors:

  • Local demand: Higher interest in your area due to local events, holidays, occupancy, and other seasonal trends will command a higher rate

  • Seasonality: Accounts for high and low seasons in your specific market

  • Booking window: Modifies rates based on how far in advance guests are booking

  • Day of week: Typically prices weekends higher than weekdays, based on your market's patterns

  • Gap nights: Reduces pricing for hard-to-fill gaps between your reservations

  • Restrictions: Adjusts pricing when recommendations go below your minimum price or above your maximum price


Special Considerations

Property Uniqueness

If your property is particularly unique:

  • The system will still provide recommendations based on the closest comparable properties

  • You may need to set a custom Base Price or make more manual adjustments initially

  • As booking history builds, pricing will become more tailored to your property

New Properties

For properties with a limited booking history:

  • We rely more heavily on market data and property characteristics

  • Initial pricing may be more conservative to help establish booking patterns

  • As you build booking history, the system will fine-tune your pricing

  • You may choose to set a custom Base Price as the system learns more about your property.

Market Coverage

Our Dynamic Pricing system has extensive data coverage across most markets around the world. However, there are a few limited exceptions:

  • Some markets may have limited data, resulting in more generalized recommendations

  • Certain locations (like Cuba and some remote areas) may not have sufficient data for dynamic pricing


How Often Dynamic Prices Update

  • Prices are updated daily

  • Additional updates occur when you make changes to your property settings

    • Significant property changes trigger immediate recalculations

By understanding how our Dynamic Pricing system works, you can better interpret its recommendations and make informed decisions about when to adjust your strategy.

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