refundable damage deposit

A charge takes the money and returns it later, which means the guest is genuinely out of pocket for the duration and the refund can take days to appear. A pre-authorisation places a hold on their available credit without capturing funds, and releases automatically after a set period.

Holds are gentler on the guest and easier to unwind, but they expire, which matters on long stays, and some cards handle them poorly. Whichever you use, state plainly at booking which it is, how much, and when it comes back. Most deposit disputes are really disputes about surprise.

Too low and it does not cover the incident it exists for. Too high and it costs bookings, since a guest comparing two properties will avoid the one holding a large sum. A sensible starting point is the cost of the most likely single incident in your property rather than the worst imaginable one.

Work that out from your own history rather than from a forum. How to estimate your STR damage risk walks through the inputs, and collecting a damage deposit for direct bookings covers the amounts and mechanisms in practice.

A deposit is not a licence to charge whatever you find. Deduct only documented amounts, show the guest the same evidence you would show a claims reviewer, and send the breakdown before or at the same time as the deduction rather than afterwards.

A deduction made without evidence is the fastest route to a chargeback, and on a direct booking you are the merchant of record defending it. Return the balance promptly, because a slow refund generates as many complaints as the deduction itself.

Airbnb removed host-set security deposits from its booking flow, so on platform stays the protection is the platform programme rather than a deposit; the history and the consequences are in do Airbnb security deposits still exist in 2026 and in security deposit.

That leaves deposits as a direct-booking and partner-platform tool, competing with the damage waiver model. Which one to run is a conversion decision as much as a protection decision, compared in damage waiver versus security deposit versus deposit-free.