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Jul 25 2012

How to Handle a Cancellation from a Vacation Rental Tenant

How to handle cancellationsIf you rent your home long enough, as we have, it may happen to you.  One of your tenants calls to say they need to cancel their booking.   In the majority of cases, this tenant is cancelling because of unfortunate circumstances, such as an illness in the family. What do you do?

Take steps to rebook the week

The first step is to open up the week on your availability calendar. Then, if you reduce the price, be sure to promote the reduction on all your marketing efforts! On WeNeedaVacation.com, you can post a free Owner Special with something like “Cancellation for August 12-19 at reduced price of $XXXXX.”  The Special appears in bright pink on your listing and is very eye-catching to vacationers scrolling through prospective rentals.

The other step is to call even more attention to your newly available week with a fee-based feature such as the Last-Minute Availability Alert offered on our WeNeedaVacation.com site.   Designed to work most effectively in conjunction with the Owner Special, these Alerts have been proven to be very successful in bringing homeowners last-minute bookings.

Check your lease

Be sure to consult the clause in your lease that pertains to cancellations.  Most leases say that monies received will be refunded (usually less a 5% fee) only if the home is re-rented and that the owner will make every effort to find a tenant.  The lease should also stipulate that, if you need to reduce the rent, you will deduct the reduction amount from the funds returned to the tenant who cancelled.   

Of course, your ability to rebook the week will depend in part on the timing of the cancellation.  If the vacationer cancels months before the rental week, you should be able to easily fill the newly available week.  But if the cancellation comes very close to the rental week, which it often does, rebooking is more difficult.

Should you refund?

It’s not easy to refuse to refund a rental deposit to a family obviously experiencing an unexpected and unfortunate event such as an illness, and you must respond as your own conscience dictates. Keep in mind the possibility that these folks might return in the future if you handle the situation in a compassionate way. You could also offer to credit their deposit towards a future stay with you.

Have you had a tenant cancel at the last minute due to a personal emergency? How did you handle it?

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About the author

Joan Talmadge

Joan Talmadge - My husband Jeff and I created WeNeedaVacation.com in 1997, shortly after buying our Cape home. My background includes teaching fifth grade for 8 years and writing and editing educational publications for 15. I get great joy from helping fellow homeowners successfully rent their homes. Jeff and I are proud to have two of our three grown children working for WeNeedaVacation.com, truly a family-run business. For me, the Cape and Islands are magical all times of the year -- whether it's walking on Nauset Beach, playing golf, or enjoying family and friends. Email Joan

1 comment

  1. kathy werber

    I’ve often fretted about this but only had a possibility of it happen once. A tenant was expecting a sudden move due to a job change. We agreed that he would pay for additional advertizing (pre- We Need A Vacation days) and would cover any loss we took by having to reduce the fee. In the end, he was able to use the house,

    The situation on the Vineyard would be more complicated if you’ve already transferred the ferry tickets. I’d try to work with the Steamship Authority.

    Sudden family emer – I might reach a compromise…and hope good karma came back to me.

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