What does the new Airbnb law mean for Cape Town property owners?

Cape Town has approved new legislation that will have a significant impact on how short-term and holiday rentals will operate in the city, enabling property owners to financially benefit from the tourism industry.

January 9, 2020

The new law allows for short-term letting from a house or a flat for a period not exceeding 30 days for the same guest, and provides a framework for the City of Cape Town and Airbnb to work together.

Why was this new law brought in?

The new Airbnb by-law was brought in to amend the City of Cape Town’s municipal planning by-laws and accommodate the new business model created by Airbnb. It provides clarity by ensuring that the City of Cape Town and Airbnb work together effectively to make the process easier for hosts. In addition, it helps regulate the industry by ensuring that informal accommodation providers abide by the relevant laws and regulations in place, and that they are compliant with the Federated Hospitality Association of South Africa.

What does the new law mean for Airbnb hosts and tourists?

It will now be simpler and easier for people who currently rent their properties out through Airbnb, ensuring that they are in line with relevant local laws to avoid penalties. For people who are interested in becoming a new host, this law means that there will be a clear and well structured working Airbnb model which they will be able to follow.

The Airbnb model has already proved to be a positive business opportunity for South African property owners and the implementation of this new law will make it even easier and offer more people the chance to generate an income through renting out their home. This will naturally create additional jobs and will have a positive effect on the economy.

The experience of staying in someone’s home rather than a guest house or hotel is a huge advantage to tourists who are able to enjoy unique and more authentic travel experiences. Airbnb means they are able to stay in areas that are off the beaten path, immerse themselves in the local culture and be close to some of the popular tourist attractions and activities such as the township tours and Cape Malay cooking experiences.

This model can also benefit those who are in the process of moving home and need a short-term rental to cover a period in between.

Managing the potential difficulties

With any disruptive business model, there are always challenges that need to be dealt with.

One such issue is security as this rental model means that there will be more people coming and going from a property than usual. Careful measures need to be put in place to address this and to ensure the security of the property, and of the neighbours particularly when the Airbnb property is an apartment.

This new legislation may also conflict with the rules of the body corporate or homeowners association, many of whom prohibit short-term letting of sectional title units. Any homeowner is required to confirm this before renting their property out using Airbnb, and must comply with all body corporate or homeowners association rules.

Written by Wessel de Kock

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