Case Study: “Say Yes” rejections impact property performance

Key Takeaways: 

1. Unlocking Community Retention

• Properties embracing more inclusive screening practices demonstrate improved member retention rates, revealing how lower barriers to entry can cultivate lasting, engaged resident communities.

2. Optimizing Vacancy Cycles
   • Properties with lower rejection rates demonstrate remarkable efficiency in filling vacancies, cutting typical vacancy periods by approximately 50% and maintaining steadier revenue streams.
3. Speed to Stabilization
   • More welcoming acceptance practices correlate directly with higher occupancy rates, ensuring rooms generate consistent revenue instead of sitting empty.
4. Driving Financial Excellence
   • Lower rejection rates consistently yield stronger financial metrics across the board – from gross revenue to host payouts to room-level earnings – with the increased revenue significantly outweighing any additional operational costs.
5. Creating Sustainable Success
   • The data shows that a more inclusive screening approach creates a virtuous cycle: stable communities foster financial success, while financial success enables better member experiences.

On PadSplit’s platform, hosts wield significant control over member selection through the “Say Yes” feature, allowing them to evaluate and accept promising residents while declining others. But how does a host’s selectivity impact their property’s success? 

To answer this question, we conducted a focused comparison between two properties with remarkably similar profiles – both launched their listings in the same month, operated in identical metropolitan markets, and featured comparable weekly rates, bedroom counts, and volumes of booking requests.

What sets these properties apart is their markedly different approach to screening potential members. While Property A maintains a more inclusive acceptance policy, Property B declines nearly four times as many applicants. Through a detailed analysis of key performance metrics – including revenue generation, occupancy levels, vacancy fill times, and member retention – we can uncover how these contrasting screening approaches shape each property’s bottom line.

Key findings

Retention

• Property A: Retention rate of 44% after eight weeks.
• Property B: Retention rate of 43%.
• Conclusion: Higher selectivity doesn’t necessarily translate to longer-term residents. In fact, Property A’s more inclusive approach resulted in marginally better member retention, suggesting that a lower barrier to entry can foster a more stable community of residents.

Occupancy & Time to Fill

• Time to Fill: Property A takes 14 days to fill a vacancy, while Property B takes 30 days, more than twice as long.
• Occupancy: Property A maintains a higher occupancy rate of 78%, compared to 69% for Property B.
• Conclusion: Properties that accept a higher percentage of applicants demonstrate clear advantages in operational efficiency: they fill vacancies more quickly and maintain higher occupancy rates throughout the year. This streamlined turnover process ultimately drives stronger overall property performance.

Financial Summary (6-month period)

• Gross Revenue: Property A generates $30,423, compared to $25,804 for Property B.
• Host Payout: Property A’s hosts earn $23,560, exceeding Property B’s payout of $20,357.
• Room Payout: Property A averages $2,600 per room, outperforming Property B’s average of $2,000 per room.
• Fees: Property A incurs higher booking fees ($4,811) and service fees ($2,051) than Property B ($3,676 and $1,770, respectively).
• Conclusion: The data reveals a compelling financial upside to maintaining lower rejection rates: properties that accept more applicants consistently generate higher revenue and deliver stronger payouts to hosts. This suggests that a more inclusive screening approach doesn’t just benefit potential members—it translates directly to improved financial performance.

Summary

• Property A generates a higher annual earning and greater returns over 2 and 5 years compared to Property B.
• Over 5 years, Property A offers an additional $32,030 in returns compared to Property B.

Rejection rates influence revenue

Our analysis reveals a clear relationship between rejection rates and property success on the PadSplit platform. Properties that maintain lower rejection rates consistently demonstrate superior performance across key metrics:

• Enhanced Member Stability: Properties with lower rejection rates achieve higher retention rates, creating more stable communities and fostering stronger resident engagement over time.
• Accelerated Vacancy Filling: These properties significantly reduce their time-to-fill metrics, minimizing costly vacancy periods and maintaining consistent income streams.
• Maximized Occupancy Levels: More inclusive acceptance practices lead to consistently higher occupancy rates, ensuring rooms generate revenue more consistently throughout the year.
• Superior Financial Performance: Lower rejection rates translate directly to stronger financial outcomes, including higher gross revenue and increased payouts for both hosts and individual rooms.

While Property A’s increased member activity did result in higher operational fees, the substantial gains in revenue and payouts far outweighed these additional costs. Based on these findings, we encourage hosts to carefully evaluate their current rejection rates and consider adopting a more inclusive approach through the “Say Yes” feature.

The evidence is compelling: reducing rejection rates delivers both financial benefits and improved member experiences, creating a winning formula for success on the PadSplit platform.