Is booking an Airbnb rather than hotels cheaper for you always?

Book your flights in advance to get cheaper fares. Ideally, go with one that has a layover. Fly to a country when it is either the shoulder season or off season—the time when there are fewer tourists—to further cut your travel costs! These are some money-saving tips that will come in handy when you plan a low-budget holiday. But what about hotel prices that can blow a hole in your budget? There’s a hack here too. Opt for Airbnb which offers cheaper accommodation alternatives.

Airbnb allows customers to book a part of someone’s home–commonly known as B&Bs, or bread & breakfast–or the entire property for nightly rentals. Hotel booking sites such as booking.com also have B&B listings. These lodging options are non-commercial in nature, which is the primary reason for their lower pricing compared to hotels.

Airbnb was started with the idea of allowing homeowners to sublet a spare room or two of their house, but over the years the concept has developed into a proper business opportunity for property owners as many now let out their entire house on the platform. In fact, in some popular travel destinations, including Goa, Dehradun, Himachal Pradesh, people have started investing in apartments and villas for the sole purpose of listing them on Airbnb platform. Some even lease properties from homeowners and sublet them on the platform to generate a regular income.

All this is good news for travellers as it gives them a wide range of cheaper alternative to hotels. Mint’s research shows that staying in an Airbnb in most of the popular travel destinations in India and abroad can save you about 10-30% of the costs compared to booking a 3-star hotel offering similar amenities (see graphic). However, this doesn’t mean it will always be the cheaper lodging option .

When is Airbnb cheaper?

Airbnbs come in a broad price range according to the size of the space, minimum number of guests allowed, amenities, location, furnishings and other factors. For instance, a single room in an apartment that is shared by the host and other guests can be 20-50% cheaper compared to a property in the same locality that is let out exclusively to travellers and the host lives elsewhere. Similarly, a place with premium furnishings or a scenic view will be priced higher compared to other properties that offer the same amenities but lack any of these two features.

In tourist destinations, one can even find stays that are priced similar to 5-star hotels offering unique experiences, such as a glass house, luxury farm cabin, vintage villa or premium houseboat. In metro cities, price variations are limited as the size and location are the only two major factors that influence the prices.

Shivya Nath, a travel blogger and author of The Shooting Star, says Airbnbs are, strictly from a price point, more affordable not just in India but around the world. “In European countries, when you want to stay in a neighbourhood which is more accessible from the city centre, an Airbnb is more economical compared to hotels which are excessively priced in prime locations,” she said.

People looking for longer stays extending beyond a week can reduce their lodging costs by staying in an Airbnb as the platform offers tiered pricing to encourage longer reservations. Nalin Jha, a super-host on the platform, said he offers a 10% discount to guests booking on a weekly basis, while those booking the property for a month get a very attractive 20-25% off. “Extended stays present reduced overhead expenses for the host, which allows us to pass on those savings to the guests,” said Jha, who has about 13 listings across Delhi and Goa. This could be useful for those who travel frequently to other cities on work and have to stay there for longer periods. Professionals who continue to work remotely from their home towns and rent out a cheaper place near their workplaces can instead use Airbnbs during their visits since these are a better-quality option available at affordable prices.

During extended stays, one can even use the kitchen on the property to cook a meal and save on eating out at restaurants. While vacations are meant for relaxing, cooking your meals can easily save you over 50% on the restaurant bill.

Airbnb also gives you the flexibility to get a good bargain on the price on some occasions, said Nath. “During the off season, for instance, one can ask the owner to offer a lower price. I wouldn’t say it’s a hard bargain, but it’s worth asking, especially if you’re staying for a longer duration,” she said.

Though Airbnbs are cheaper, it may not make sense to book it on all occasions. Properties that are let out as single units are not always economical for a couple or solo traveller. For instance, villas in tea and cardamom estates in Munnar for 8-12 guests are priced at ₹14,000-20,000 per night, which works out to about ₹1,600 per head. While it’s a good deal for a big group, it’s better for couples to stay in a hotel near such an estate.

In fact, the Airbnb market in some international tourist cities, such as Bangkok (Thailand) and Bali (Indonesia), are so developed that luxury villas with private pools and big apartments in skyscrapers are more commonly listed on the platform in place of the standard stay-in-a-home experience of B&Bs.

In some tourist hot spots, B&Bs are located far from the city—the city centre is usually located in a commercial district that does not have many residential pockets. In such cases, opting for a B&B would mean that you spend more on commute shuttling between the city, tourist attractions and your lodging.

Also, the Airbnb market in tier-2 cities and other towns in India is not as developed, so expect the quality of stay to be basic with not many amenities on offer. Some hosts also levy a cleaning fee, so check the net price and not the list price while comparing prices with hotels.

Who is it for?

Since Airbnbs are essentially somebody’s homes that are available on daily rental, they lack the facilities of a service desk, housekeeping, round-the-clock restaurant and room service that hotels provide. So, when you step out of your room, remember that you will not be coming back to a room where the beds are made up or the washrooms cleaned, unlike in a hotel. Also, you have to figure out the breakfast menu yourself—either cook or order from a restaurant, whereas most hotels provide elaborate breakfast buffets. “Hotels give you a standard experience, whereas, with Airbnbs, it can vary greatly as these are mostly homes that people live in,” said Nath.

So, travellers who prioritize convenience would be better off staying in a hotel.