Airbnb offers a range of cancellation options for hosts, each with different implications for refunds and guest flexibility. Choosing the right one for your property, market, and business goals is a strategic decision, not just a default setting. You’ll gain immense power by making an informed choice.

Here’s to making more to help you make strategic decisions for your STR business.

The Core Airbnb Cancellation Policies Explained for STR Hosts

Airbnb provides several standard cancellation policies. Each balances guest flexibility with host protection. As a host, your choice directly impacts your financial security and booking appeal. Remember, a mandatory 24-hour free cancellation window applies to most bookings confirmed at least 7 days before check-in, regardless of your chosen policy. This means guests can cancel within the first 24 hours of booking for a full refund if their check-in is far enough away. Now, here’s a breakdown of your cancellation policy options on Airbnb:

1. Flexible: Maximum Guest Freedom

• Refund: Guests can cancel until 24 hours before check-in for a full refund.
• Host Payout: If guests cancel less than 24 hours before check-in, you’ll be paid for each night they stay, plus one additional night.
• Best for: New listings or properties in highly competitive markets. It can boost your search ranking, offering high booking appeal but minimal protection for very late cancellations.

2. Moderate: A Balanced Approach for Peace of Mind

• Refund: Guests can cancel until 5 days before check-in for a full refund.
• Host Payout: If guests cancel less than 5 days before check-in, you’ll be paid for each night they stay, plus one additional night, plus 50% for all unspent nights.
• Best for: Most hosts seeking a sweet spot. This policy reduces last-minute risks while still attracting guests and typically provides enough time to potentially rebook, depending on your market and size of property.

3. Limited: A Newer Option for Defined Security

• Refund: Guests can cancel until 14 days before check-in for a full refund.
• Host Payout:
  • If they cancel between 7 and 14 days before check-in, you’ll be paid 50% for all nights.
  • If they cancel less than 7 days before check-in, you’ll be paid 100% for all nights.
• Best for: Hosts looking for a balance between Moderate and Firm, offering more security than Moderate without being as restrictive as Firm.

4. Firm: Stronger Host Protection & Commitment

• Refund: Guests can cancel until 30 days before check-in for a full refund.
• Host Payout:
  • If they cancel between 7 and 30 days before check-in, you’ll be paid 50% for all nights.
  • If they cancel less than 7 days before check-in, you’ll be paid 100% for all nights.
• Best for: High-demand properties or unique stays where a longer commitment is desired. This policy helps secure more committed bookings, offering better financial certainty further in advance.

5. Strict: Highest Host Security but Not Available in Many Circumstances (Updates in 2025)

• Important 2025 Update: With Airbnb’s recent updates to their cancellation policies, the Strict cancellation policy is no longer available for new listings or hosts in many regions. Existing hosts who previously used this policy will be automatically transitioned to the Firm policy unless they opted to keep Strict by October 1, 2025.
• Host Payout:
  • If guests cancel 7 or more days before check-in, you’ll be paid 50% for all nights.
  • If they cancel less than 7 days before check-in, you’ll be paid 100% for all nights.
• Best for: Certain premium properties or long-term stays where applicable, offering maximum financial security but potentially deterring guests seeking flexibility.

The Following Standard Cancellation Policies are Available by Invitation Only from Airbnb:

6. Super Strict 30 Days

• Host Payout:
  • If guests cancel at least 30 days before check-in, you’ll be paid 50% for all nights.
  • If they cancel less than 30 days before check-in, you’ll be paid 100% for all nights.

7. Super Strict 60 Days

• Host Payout:
  • If guests cancel at least 60 days before check-in, you’ll be paid 50% for all nights.
  • If they cancel less than 60 days before check-in, you’ll be paid 100% for all nights.

Beyond the Basics: Navigating Airbnb’s Nuances & 2025 Changes

Choosing a policy is just the start. There’s so much more to consider as an STR host when navigating Airbnb’s cancellation policies in 2025:

• New Mandatory 24-Hour Free Cancellation Window: Effective this year, guests can cancel for a full refund within 24 hours of booking, if the reservation was confirmed at least 7 days before check-in. This applies across almost all standard policies and is a significant shift. Hosts cannot opt out of this.
• Extenuating Circumstances Policy (Major Disruptive Events): This is a critical override. Airbnb’s policy allows cancellations without penalty in unforeseen situations. Think natural disasters, government travel restrictions, or severe personal emergencies (e.g., documented death, serious illness). As a host, you’re expected to honor this. While it protects guests, be aware of its potential impact on your income. You can review the full policy details directly on Airbnb’s Help Center.
• Long-Term Stays (28+ nights): These have separate cancellation policy options. Typically, the first month is non-refundable, and a 30-day notice is required for cancellation once the stay has begun.
• Impact on Visibility and Bookings: More flexible policies can sometimes lead to better search visibility and higher booking rates. Guests often prefer less risk. However, this must be weighed against your risk tolerance for late cancellations.
• Your Market Dynamics: In a highly seasonal or competitive market, a more flexible policy might be necessary to secure bookings. In a high-demand, low-supply area, you might afford a stricter policy without deterring guests.

Choosing Your Policy: A Strategic Decision for Your STR Business

Selecting the right Airbnb cancellation policy isn’t a “set it and forget it” task. It requires strategic thinking for every short-term rental host:

1. Assess Your Risk Tolerance: How much financial risk are you willing to take with late cancellations? Your comfort level should guide your choice.
2. Understand Your Market: What are your competitors offering? Is flexibility expected, or is demand high enough to support stricter terms?
3. Consider Your Property: Is it a unique destination that requires specific planning, or a general listing that could be rebooked quickly?
4. Review Your Data: If you’re an existing host, look at your past cancellation patterns. This data is invaluable for informed decisions.

Optimizing your cancellation policy is just one crucial piece of the puzzle. Building a truly profitable and sustainable STR business requires understanding how every decision impacts your bottom line and guest experience. It’s about proactive management and smart strategies.

Ready to Accelerate Your STR Success?

Navigating the complexities of Airbnb – from Airbnb’s cancellation policies to pricing strategies, dynamic market shifts, and seamless guest communication – can be overwhelming. What if you had a clear roadmap and expert guidance to scale your short-term rental business effectively?

It’s time to stop guessing and start growing. The STR Success Accelerator is a comprehensive coaching and mastermind program for women who are looking for a clear path, expert guidance, and real-time support. It’s designed to equip you with the exact strategies, systems, and tools you need to go from scattered to scaling. 

Ready to transform your STR business and unlock its full potential?

Book a Clarity Call with my team today! Meet with our Growth Manager to discuss your goals and discover how the STR Success Accelerator can help you achieve breakthrough results.

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