Security Deposits

  

 

When we receive guests, we require a refundable security deposit. This requirement is clearly stated in the Property Rules section to ensure transparency and provide peace of mind for both our guests and us as hosts. It is important that you understand the importance, the benefits and the limitations of this measure. If you would like to make a claim, it's also important to understand how best to handle that process.

 

The benefits of taking security deposits

•   Encouraging  Responsible Behavior

This is what we believe to be the main benefit of charging damages deposits. They work as an incentive to encourage guests to take care in the property. Experience has shown that guests are more likely to treat the property with care and respect when a security deposit is in required. This commitment from guests helps preserve the property's condition and reduces the likelihood of damages, ensuring a better experience for all future guests.

• Allowing easy compensation for owners in the case of any damages 

A security deposit safeguards a holiday home against potential damages or excessive wear and tear. Maintaining a property in excellent condition is crucial to ensuring that all of our guests enjoy a comfortable and pleasant experience. The security deposit ensures that funds are available in the case of any damages and that damaged items can be easily replaced.

• Prompt and Efficient Issue Resolution

In the rare event that damages occur, having a security deposit allows for quicker and more efficient resolution. This eliminates the need for lengthy disputes or insurance claims, providing a hassle-free experience for both parties. Our priority is to resolve any incident fairly and promptly.

• Fully Refundable

It is important to highlight that the security deposit is fully refundable, provided the property is left in good condition. Following departure our holiday homes are cleaned and any problems that are found are reported by the cleaners. If no problems are reported we return damages deposits approximately four days after departure. We ensure that damages deposits are refunded promptly following a guest's departure, otherwise guests soon feel that we are deliberately withholding funds. This ensures fairness and trust in our booking process.

• Enhanced Guest Confidence

For some guests, the presence of a security deposit can increase confidence in their booking decision. It demonstrates our commitment to maintaining a high standard for the property, which reassures guests of the quality and reliability of their stay. We want you to feel secure when choosing to stay with us.

 

The limitations of security deposits

Very often guests are able to book holiday homes from owners that do not charge damage deposits. Given the choice guests will often prefer to book a property where no security deposit is required. Owners requesting damages deposits can often lose out on bookings, especially if the amount that they charge is considered to be high. Given that damages are very rare it can be difficult to justify the financial security provided by damages deposits when weighed up against the financial costs of missed bookings. 

Particularly in cases when guests have not paid security deposits in other holiday homes that they have used, they can feel mistrusted and suspicious about why they are being asked to pay a security deposit. Sites such as Airbnb use an insurance scheme to handle damage by guests, so guests are not asked to pay a security deposit. Guests that have not paid security deposits before can be unpleasantly surprised when they are asked to make an additional payment that they weren't expecting. Guests often ask what guarantees they have that the funds will be returned to them following their stay.

At times guests may wrongly be accused of causing damage. It may be that a damaged item went unnoticed when guests entered a holiday home. Especially at busy times of the year, cleaners and property managers are very pushed for time as they may have a number of different changeovers to handle in one day. It can be easy to miss small damages that may have occurred or not notice the absence of some items. Subsequent guests can then be blamed and charged for those damages when they are noticed. Guests that have experienced an injustice like this will be very reluctant to pay a damages deposit again.

Everything deteriorates over time, though there will be a moment when a breakage occurs. For example the fixtures holding a chair leg in place will loosen with use over time. As those fixtures loosen, the leg will become more and more likely to break. Eventually the break will occur, possibly when a larger guest sits down on that chair. The guest may be held accountable for the breakage though really that moment was long coming and gradually caused by every other use or movement of that chair. This is particularly problematic when owners provide poor quality furniture that really is insufficiently robust for guests.

A huge amount of effort can be put into creating positive guest experiences. With satisfied guests we hope to have return visitors and recommendations. This all helps with the success of a holiday home as it generates additional income. Every guest should feel valued. When a guest is accused of causing damage in a property they are likely to have negative sentiments, especially if they didn't in fact cause the damage. All of the good work that has gone into helping them have a positive experience can be lost.     

Guests that feel wronged through a claim from their damages deposit can then go on to harm the reputation of that holiday home. This may be simply by advising their friends and family not to stay in the property but it may be worse, through public reviews. All of the platforms encourage guests to post reviews following their stay and those reviews guide future guests towards or away from your property. When guests feel that they were unjustly charged for some damage they will often go on to post a damning review. That review will then have financial consequences for the owner as guests become afraid to book that property. A small, ill-advised damages claim can cause significant losses for an owner.

When guests feel concerned because they are paying a damages deposit, they will often want to report all minor problems they find on arrival at a holiday home. This will be because the guests are concerned that they don't get blamed for the problems. However, it may feel intrusive to owners and property managers when they are presented with a long list of faults.

Often guests pay very large amounts of money for a stay in a holiday home. Given that they feel that they have paid so much, guests will often feel that an owner is pedantic if they are then charged for some damage that they feel is minor or petty. A lot of the goodwill that may exist between guests and owners can then be lost.  

When an item is damaged an owner may charge an amount that a guest believes to be excessive. This is especially the case if the item is old and already in poor condition. The item may have depreciated significantly in value though the owner still wants to charge for a new replacement product. This complexity can cause mistrust and bad feelings between the guest and the host.

It's important to remember that a damages deposit is to cover damages, not cleaning. In the unusual case of a property being mistreated, typically the most disturbing and evident aspects of that relate to cleaning. The sight of waste strewn across the floor of a lounge, overflowing bins, unwashed pans and dishes is the last thing that property managers, cleaners or owners want to see. When guests leave a property in those kind of conditions, of course they create an awful lot of unpleasant, excess work for the property managers and the cleaners who may have busy schedules and commitments that are then thrown into chaos as they deal with the unexpected workload. Those property managers and cleaners have every right to be upset and angry about those situations. However, once the cleaning has been done, the question then arises about damage. Very often there will be little or no damage caused to the property. In these situations it can be difficult to claim for compensation from guests as we may not be able to point to specific costs for replacement items. 

To complicate matters further, for all of our bookings we charge guests a fixed cleaning fee. Guests may (choose) to interpret that fee as covering all of their cleaning requirements, though we may feel that would be unreasonable and we always inform guests that our properties should be left free of waste with all kitchen equipment cleaned and stored away. It can also become difficult to argue that guests should pay for excessive cleaning when we consider whether we refund guests who thoroughly clean a property before departure? Furthermore, our own ideas of how clean a property has been left may genuinely differ from the guests' opinions. Essentially there is potential for disagreements and differences of opinion and accordingly there is the risk of inviting resentment and poor reviews if we then penalise guests from security deposits.

Where excessive cleaning is involved our advice is normally to try to have broad shoulders and accept that sometimes we can have these issues, though fortunately they're very rare. Owners can often take things personally when confronted with pictures of their property with overflowing trash etc. Property managers and cleaners will express their anger and for an owner it can be very tempting to "punish" or "educate" the guests that have shown such disrespect. However it's important to keep in mind that those guests are likely to respond poorly to being penalised and given that they probably won't book the property again, the owner would be unlikely to benefit from their education. What does the owner stand to gain and at what cost? We would always say that it's important to recognise the people that are actually impacted and inconvenienced by it, the property managers and the cleaners. Owners might feel bitter about the situation but it's the property managers and the cleaners that will deal with the unpleasant situation and ultimately resolve the problem. Any owner should be focussed on showing appreciation to those people that resolve the issue, that might be by sending some extra funds for additional hours worked or a gift. Whether the guests cover those costs or not is separate concern and it should always been considered whilst keeping in mind the question, "how much is to be gained and at what cost"?

 

How to make a claim from a security deposit

In the unfortunate situation that you do need to make a claim from a security deposit it's important to handle the process in the best way possible. Here are the steps to take to ensure that there is as little friction as possible both with the guests and with any booking platforms that handle damage claims such as Airbnb. 

It's important to handle any claims as quickly and efficiently as possible. As discussed above, we only keep security deposits for 3 or 4 days after a guest's departure so any delays in notifying us about any damages could mean that we have already returned the deposit. Furthermore it's important for guests that they are informed of any problems as soon as possible. Often the person responsible for making the booking won't know about the damage (it may have been caused by a child in the group). If they have left the property some time back they may wonder if they're being blamed for damage caused by subsequent guests. A number of booking platforms also restrict how long they will process a damage claim. For example with Airbnb's policy AirCover for Hosts, which is the protection program for property damage or theft, hosts are required to report any damage within 14 days of the guest's checkout or before the next guest checks in, whichever comes first.

Take good pictures of any damages caused. If we're handling a damage claim directly with a guest or if we are processing a claim through a booking platform such as Airbnb we will need to show clear evidence of what we are claiming for. For this we need good photos showing the damage. Receipts showing the value of any broken items are also necessary as they will show how we arrived at the figures that we are claiming for. In the absence of receipts we need to provide links to the same or similar items available online. Again, speed is paramount with this process as delays in providing these pieces of evidence could mean that we run out of time to make a claim.

Ideally the guests won't dispute the request for compensation as this will make the process much easier for all parties. The guests are more likely to agree with a compensation request if they feel that the request is reasonable. If the damage claim is for an old, worn item, then account for that in the amount that you request for compensation. You can explain that you are only requesting a percentage of the replacement value because you recognise that the item is not new. The guests will then be less likely to dispute the claim. When we make claims through the Airbnb, part of that process is determining the age of the damaged item as they will account for depreciation in the value that they assign to it.               

 

In Summary

Undoubtedly there are benefits to taking security deposits for bookings for holiday homes. In our opinion, the key benefit is that a security deposit encourages guests to take care in the property. It's not necessary to charge a large security deposit to achieve that and given the very real risk of missing out on bookings, we would advise owners to keep damages deposits low. In most cases, withholding funds from a security deposit is counterproductive as guests often disagree with claims and an otherwise positive experience can soon turn sour for little gain. There are a number of insurance providers for holiday homes owners that include accidental and intentional damage in the cover that they offer. It's best for owners to protect themselves from any major losses through one of those insurance products. Very often owners will determine the amount that they request from a security deposit by making it match the excess that their insurance provider charges. Owners should always be cautious when penalising guests through security deposits.