Why vacation rentals can be just as rewarding as hotels

When it comes to travel lodging options, vacation rental companies like Airbnb, VRBO and FlipKey are becoming increasingly popular alternatives to traditional chain hotels and resorts. Unlike hotels, however, these companies don’t have any co-branded credit cards that allow you to simply earn points on stays. But that doesn’t mean you can’t incorporate certain rewards-based strategies into your plan.

“It’s not as simple as staying in a traditional hotel, but if you get strategic about your booking there are ways to use rewards and points to your advantage,” says Dia Adams, author of the travel blog TheDealMommy.

Why get a vacation rental when you can get a hotel room?

Affordability and diversity seem to be the driving factors behind the increasing popularity of rentals-by-owner sites. According to a 2016 New York Times article, one in three travelers used private accommodations last year, which was up from one in 10 in 2011.

“I’m starting to realize that sometimes a site like Airbnb is my only option, and from a family perspective they provide some excellent lodging alternatives,” Adams, a mother of two, says. “If I can get a three-bedroom house instead of a single hotel room, that’s sometimes too good to pass up.”

What’s more, rentals through sites like Airbnb are often cheaper than traditional hotels. Last year the bus-travel booking site Busbud conducted a study of more than 220,000 Airbnb listings around the world and compared those rates to average hotel stays. In many major U.S. cities the Airbnb rates were substantially cheaper. For instance, Airbnb stays in New York City were $81.80 per night cheaper, on average, than comparable hotels in The Big Apple.

Credit-card rewards options

Perhaps the easiest way to apply a rewards strategy to some vacation rental sites is to take advantage of credit card perks that reduce the cost of travel. For example, the Chase Sapphire Reserve provides $300 in annual travel credits to be used toward travel purchases – and codes some vacation-rental sites, including Airbnb as travel. That means the first $300 spent on an Airbnb abode could be completely reimbursed, if you haven’t made any other travel purchases yet that year.

What’s more, you’ll earn extra rewards points for travel purchases made with certain cards. Booking an Airbnb home, for example, will get you double points on the Chase Sapphire Preferred card and 3X points on the Citi ThankYou Premier card.

“If you’ve got a card that offers these types of travel expense perks, something like Airbnb might be a good option for you,” says Jonathan Hayes, founder and CEO of RewardStock.com, a site that aims to help people manage and take advantage of credit card rewards programs. “This is another reason why I always recommend having a diverse portfolio of credit cards that can be tailored to your specific travel needs.”

What’s more, booking your rental property with a credit card offers various degrees of protection against sudden cancellations.

Experts caution that travelers need to carefully check the merchant category code (MCC) for the rental site they plan on using, because not all of them are coded as travel. For instance, Airbnb and FlipKey are coded as travel sites, whereas HomeAway (and its subsidiaries VRBO, VacationRentals.com, and CyberRentals.com) are coded as real estate sites.

“That means you can’t earn bonus travel points at those sites, even if you’re using a card with travel rewards perks,” says Hayes. “And that defeats the whole purpose of planning a rewards strategy for this type of stay.”

The miles-and-points redemption option

It’s becoming increasingly popular for certain credit cards to offer cash back equivalent redemption points when booking rentals through sites like Airbnb.

“I think the best value here is the Barclay Arrival+ card,” says Adams. “You can redeem points for purchases over $100 and they give you an extra 5 percent if it’s a travel purchase. That’s two points per dollar, which is a solid value.”

American Express cardholders can also redeem Membership Rewards points on Airbnb’s website. As of right now, however, the conversion rate isn’t great ($.70 for 100 MR points), but “it’s better than nothing,” says Richard Kerr, chief operating officer for the rewards-booking service The Points Consultants.(American Express is a CreditCardForum advertising partner.)

The gift card option

A potentially more lucrative way to redeem points is by purchasing an Airbnb e-gift card through your card’s rewards portal (if it has Airbnb gift cards). You’ll want a point value ratio of 1 cent per point (i.e. a $100 card costs you 10,000 points). Furthermore, online retailers like Ebates and Overstock will often have 10-percent-off sales on Airbnb gift cards. These sites are often part of credit-card rewards portals, meaning you’ll get double (or more) bonus rewards when you click through to these sites from your account. This could be a way to get both a discount on your stay at some of the world’s more secluded and privately owned homes, as well as a way to earn bonus points with your card.

“If you’re planning an Airbnb stay, start looking for these gift card deals several months in advance,” says Kerr. “You could wind up staying somewhere sweet for a fraction of the sticker price.”

The earning-miles option

Finally, Airbnb has a few new airline partnerships that should be considered if you’re planning to book one of their rental properties.

First, Delta travelers can earn 1 SkyMile per dollar spent on an Airbnb stay when it’s booked through Deltaairbnb.com. And if you’re a new Airbnb user you’ll get a $25 Airbnb credit and 1,000 bonus SkyMiles when you book your first stay of $150 (and 500 miles when you book a stay of at least $75).

This is a particularly lucrative strategy for double dipping if you’re already invested in the Delta SkyMiles program, says Gilbert Ott, writer for Conde Nast Traveler and founder of God Save the Points.

“If you book a stay using the Chase Sapphire Preferred, you’ll get two-times points for spending on travel along with the SkyMiles,” says Ott. “That’s a pretty sweet deal for a non-traditional vacation stay.”

Secondly, Airbnb has a new partnership with Virgin America. If you book an Airbnb stay on Virgin’s website, you’ll earn one point for every dollar you spend. What’s more, you’ll get 1,500 bonus points and a $20 Airbnb credit the first time you book through Virgin.

“Travelers can get kind of myopic about their options and they don’t often think about using something like Airbnb because it’s not talked about as much as other more traditional types of lodging,” says Adams. “But when you start to explore this option you can really make it work in your favor if you’re smart about it.”

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