Overview
If required, there are processes in place to attempt to claim funds from guests for damage, missing items, excess cleaning, etc. As our client, we have your best interests at heart - our goal is to always recover any/all reasonable costs from guests, and we will follow up all cases to the best extent we can. The detail below is intended to assist homeowners understanding of the processes involved in claiming funds.
Reality of holiday rental
Hand in hand with accepting income as part of Holiday rental, are of course the costs associated with allowing people to stay at your home. Please see
Expected Running Costs for owners and
The Reality of Holiday Letting for more detail. Most damage/missing item issues are brought to our attention by Cleaners, but also by Guests or Owners. Our cleaners are human and may sometimes miss damage/issues that you feel should be borne by Guests – we are of course keen to ensure any costs are covered, but we can only make a claim for costs within the restrictions explained in this document. If an item/damage is missed, you are of course able to claim on your insurance (see
Unrecoverable Expenses for more detail).
Arbitration
If a guest books on a 3rd party website (Airbnb, Booking.com or Stayz/VRBO) those organisations may arbitrate between us and the guests. This means our success in claiming funds is ultimately in their hands, not just ours.
We submit a claim to the guest and then ‘escalate’ it to the 3rd party website (if the guest refuses to pay). They then determine if we’ve met their threshold of evidence. Many of the requirements listed in this document (evidence/invoices/timing) are what they require to approve a claim.
Certainty of blame
Sometimes the damage/issue can be directly linked to a particular guest (in a timely manner) and following up with them is straightforward. We will often query the cleaner to ascertain their level of certainty as to who was to blame. Any lack of clarity (e.g. if the damage was not obvious and the cleaner is not 100% certain when it occurred), may mean we’re unable to claim funds.
Evidence
The best evidence is usually a photo of the damage, preferably from the cleaner in their cleaning report, or the guest themselves. We usually require a photo to make a claim.
To charge or not to charge...
If a guest causes a small issue, they should by all rights should be held accountable for that so that you’re not out of pocket. However, sometimes the right thing is not the smart thing to do for the long-term success of your home as a holiday rental. Requesting funds can lead to negative reviews, so we may contact you with evidence of some damage/issue and ask for your input on what to do next. In this case, we will explain the damage/issue and (within the limitation of the factors listed on this document) we will proceed per your instructions – either to request funds from the guest or let them know they won’t be up for the costs (if this is what you choose to do).
An example is where a guest otherwise leaves a home well and breaks/damages something small (e.g. some crockery). The small monetary value of replacing an item does not outweigh the potential impact of a review from someone who felt aggrieved for a minor claim.
One time Opportunity
Making a claim against a guest for cost(s) for (attempted) repairs/replacements, is a one-time opportunity. If subsequent additional items/issues are identified after a claim is already submitted, those costs would not be able to be claimed against the guest.
Timing to make a claim
To claim funds, we need to be made aware of the damage/missing item ASAP after guests check out. Usually that will mean either the cleaner (or the guest themselves) inform us of the issue. If the damage/issue is missed by a cleaner and there is some delay in us being informed of the issue, we may not be able to claim costs.
Invoices
Any funds we wish to claim from guests, require an itemised invoice to be sent to us no later than 10 days after the guests check out, preferably within 2-3 days and after the issue has been rectified. The invoice can only be for costs actually incurred and we are unlikely to be successful if we claim other costs, such as time spent by an owner to rectify an issue. The invoice must be issued with an ABN that is from a business that is registered to provide those services. In the past, some 3rd party websites have done an ABN search and rejected a claim if the ABN does not appear to be of a legitimate (and relevant) service provider.
Limitations
Most 3rd Party websites (and in fact the Victorian Small Claims Tribunal) will not enforce payment to replace an item if it is damaged but still functional. Examples of this could be a dent in a fridge door, a mark on a bench/table, scratches on floorboards, or marks on carpets. We’re likely to be successful to cover the cost to (attempt to) or fix remove the dent/mark/scratch (if done in a timely manner), but not to replace the entire item.
Normal use/wear and tear
Some small issues can occur when a guest is in your home that could have occurred if you were the one staying, and is not caused by carelessness, mistreatment or wilful damage. Such issues will often be treated as ‘normal use’, and the costs would not be able to be obtained from guests. Some examples of this could be:
• blinds coming down (or the cords being broken),
• pictures/frames falling off the wall,
• doors coming off their tracks,
• toilet seats becoming loose,
• keys breaking off in locks,
• towel or toilet paper holders coming off,
• handprints on walls, etc.
If there is evidence of foul play/mistreatment, then such damage can of course be claimed, but otherwise should be considered as part of the costs of having a holiday rental.
Payout timing & Depreciation
If we are successful in claiming funds from Guests, it can take between a few days and a few weeks for that process to be completed. If you’ve paid any relevant costs (in certain circumstances we would pay some) we would then add these funds to your account, and they’d be paid along with your next monthly payment on the 15th of the following month. Sometimes claims for depreciating assets will result in a payout figure less than what was claimed, to represent the present value of the asset (much as an insurance company would do).