If your property charges the same in May as in August, you are losing money in both months. In May you are too expensive for the demand that exists; in August you are too cheap for the demand that exists.
The goal of pricing is neither maximum occupancy nor maximum rate. It is maximum total income across the season, which is a different thing and often the opposite of both.
The short version
- Rates should move with demand, season, day of the week and neighbouring properties.
- One hundred per cent occupancy usually means you are cheap, not that you are doing well.
- The last fortnight before a date is where the gaps are decided.
- Minimum stay is a pricing tool, not a rule you set once.
- Reviews affect the rate a property can hold more than the photographs do.
What dynamic pricing means in practice
It means the rate for a given date is not set in February and left there. It is revisited as the date approaches, based on how full the area is, what comparable properties nearby are charging, whether there is a local event, and how many days remain.
We use specialised software for this, but the software does not decide alone. We agree the boundaries with the owner: the floor we will not go below, and which weeks they want held for their own use.
Why occupancy is a misleading measure
A property at 95% occupancy sounds like a success. But if the rate was 30% below what the market would bear, the same property would earn more at 75% occupancy with correct pricing, with fewer turnarounds, less cleaning and less wear.
So when someone shows you occupancy alone, they are not showing you the thing that matters. The number that counts is income per available night.
The last fortnight
Most lost nights are not lost in winter, they are lost in the two weeks before the date. That is when late bookers appear, and where a small adjustment fills a three-day gap that would otherwise stay empty.
The reverse holds too: when an area fills early, the rate needs to rise before availability runs out, not after.
Minimum stay
Many owners set a seven-night minimum for the whole season and never revisit it. At the peak it makes sense, because it reduces turnarounds. In May and October it rules out most of the people who would have booked.
The same applies to gaps between two bookings. A four-night gap with a seven-night minimum will never fill.
How reviews set the rate
Two identical properties half a star apart cannot ask the same price. The score also affects position in search results, so the lower-rated property is shown to fewer people and simultaneously has to be cheaper to convince them.
So pricing does not start with the price. It starts with not losing stars on things you control: cleanliness, accuracy of the description and speed of reply.
A new property with no reviews always starts at a disadvantage. In the first weeks the right move is usually a lower rate to gather the first good reviews, then a gradual rise.
What actually happens each week
The work is not one big decision a year, it is small corrections continuously. We look at what booked in the past week, where there are gaps of three or four nights, what comparable properties are doing, and whether a local event is approaching.
Most adjustments are in the order of five or ten per cent. It is their sum by the end of the season that makes the difference, not one dramatic move.
Common mistakes
- Setting rates once a year and forgetting them.
- Comparing against properties in a different class. A villa with a pool does not compete with the apartment two streets away.
- Cutting the rate instead of improving the photographs. Cheaper does not fix a poor first image.
- Keeping a seven-night minimum across the whole season.
- Ignoring the difference between areas. Demand in Heraklion does not behave like demand in Chania.
The rate is not just the nightly number
Two properties at the same nightly rate can look very different to a guest, depending on what is added at the end. The cleaning fee, the deposit and the minimum stay shape the total someone sees for five nights, and that total is what they compare.
A high cleaning fee hits short stays disproportionately. If you want to fill three-night gaps outside the season, the cleaning fee needs to be different from what it is in August.
The same applies to the cancellation policy. A strict policy protects the calendar but costs bookings, particularly among guests booking months ahead who want flexibility.
When it is not worth the effort
If you let the property for three weeks a year to people you know, dynamic pricing will do nothing for you. It is a tool for someone trying to fill a season, not for someone already meeting their goal with a handful of bookings.
