Managing Your Vacation Rental

Cancellation policy options for vacation rental homeowners

Written by Joan Talmadge
4.4/5 - (16 votes)

As you know, the WeNeedaVacation platform provides homeowners with full control of the booking process, allowing you the benefit of defining your own cancellation policies. Nevertheless, we receive calls and emails from homeowners and vacationers alike asking about OUR cancellation policy. The answer is that it’s completely up to the homeowner.

We do, however, have some thoughts for you to consider.

Regardless of your cancellation policy, we urge you to be as communicative and understanding with your guests as possible.  If your committed guests need to cancel, you have every right to stick to the policy stated in your lease, but try to be as accommodating and sensitive as you can.

Naturally, for any prospective guests, a more relaxed policy will make them more likely to book with you. But especially for larger homes or those on the Islands, it’s very difficult to rebook a home just a short time before the stay.

Some cancellation options

Every one of your situations is different – and we are not here to judge you. These are merely some options for you to consider and, below, some ideas about how to articulate them.

  • If you’re willing, offer them a full refund if they cancel more than 3 months prior to arrival.  Giving your guests the opportunity to opt out now may give you ample time to rebook your home.
  • Offer to allow them to cancel at a later date, but only if you are able to rebook your home.
  • Offer a percentage refund depending on the timing of the cancellation vis-à-vis the date of occupancy.
  • Stick to the usual cancellation policy (see the “Fairly strict” policy below).
  • For prospective guests/inquirers, suggest they look into, which is an aggregate website that enables vacationers to compare and buy trip insurance online. Read more information about general travel insurance for vacationers.  There are benefits to you as well as your guests if they purchase travel insurance.

Examples of two approaches

Whatever policy you choose to adopt, here are some examples of language you can use, starting with the clause from our regular sample lease:

Fairly strict approach – taken from our Sample Lease

If the TENANT cancels his/her reservation, all funds received will be refunded ONLY if premises are re-rented by LANDLORD for the reservation period. LANDLORD will make every effort to find a replacement TENANT. If LANDLORD is successful in securing a replacement for the entire term of the lease, at the same rate and terms, the TENANT will receive a refund of the deposit paid less 5% of the total rent due for this lease. If re-rented for a lesser amount, the difference between this rental and the lesser rental amount shall not be refunded.  There is no guarantee that a replacement TENANT will be secured and there is no guarantee the TENANT will receive a refund if a replacement TENANT is not secured.

Lenient approach

Cancellations will be accepted on bookings made up to X weeks in advance of the rental start date with money fully refunded. Cancellations made up to X month(s) prior to the rental start date will be refunded X%, and cancellations made X weeks prior will be refunded X%.

I am hopeful that this flexibility in policy will enable you to make the best decision for you and your family. 

If you do receive any cancellations, read about How to Handle a Cancellation.

Looking to share ideas with other homeowners? Join the Vacation Rental Community – Cape and Islands Facebook group. It’s a great way to pose ideas or questions and read about what other homeowners are thinking and doing – about cancellations or anything else related to managing a rental property on the Cape and Islands.

About the author

Joan Talmadge

Joan Talmadge - My husband Jeff and I created 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, 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


  • Thank you for the good advice, Joan. We have already contacted our scheduled renters, telling them to not send any more scheduled payments until we see where this pandemic is going.

    We have not yet advertised it (because we don’t want to precipitate cancellations), but we will refund all monies received from our renters to date, almost all of whom are repeat clients. Gotta treat them right!

    • Good for you, John and Caroline. That wait-and-see attitude makes sense for a lot of us. Let’s just hope that your guests will be able to return as usual, for their and your sakes!

  • Thank you so much for this. We have, of course, been discussing what options we see that we have, including full refunds. We currently have in the lease that we take 10% out for cancellations and return the rest if we can rent for that time. We have an onsite manager/realtor who does our contracts, gives the key to renters, and respond if problems arise. I’m wondering how much we should pay her for the work she’s done so far when/if renters cancel. Any ideas?

    • Hi, Emily. Yes, our regular sample lease has a similar cancellation policy (except that it states that only 5% will be retained rather than 10%). And under normal circumstances, we feel that it’s fair. But in this situation, where huge numbers of people have lost their jobs or have had their incomes drastically reduced, we encourage homeowners to relax their normal policies as much as possible.