Cape Town could soon follow the lead of global cities such as Amsterdam, Barcelona, Berlin, London, New York, Rome, San Francisco and Vienna in tightening restrictions on short-term rental platforms like Airbnb.
This comes as the Department of Tourism finalises new regulations, which have been in development since at least 2023, aimed at bringing short-term letting in line with established tourism accommodation standards.
Managing director of property management firm Trafalgar says in a statement that the anticipated regulations could significantly impact buy-to-let investment trends and the broader residential rental market.
‘The objective of these new policies is to integrate short-term rentals into the formal tourism industry,’ says Schaefer.
‘Properties listed on Airbnb and similar platforms may soon have to comply with the same registration, taxation and health and safety regulations as hotels, guesthouses and backpacker lodges.’
These changes are expected to introduce stricter compliance requirements for Airbnb hosts, which could deter new and existing investors from purchasing properties solely for short-term letting.
Additionally, Schaefer notes that the new rules may limit the number of days a property can be rented out annually on these platforms – a strategy used by other cities to curb the impact of short-term rentals on housing availability.
Addressing housing concerns
Housing activists argue that the surge in Airbnb listings has worsened the shortage of affordable long-term rentals in Cape Town. TimeOut recently named Cape Town as the ‘Best City in the World for 2025‘, and its popularity among tourists has made short-term rentals highly profitable.
According to Inside Airbnb, an independent data platform, there are over 23 000 Airbnb listings in the city, yet at the start of the year, fewer than 700 long-term rental listings were available in the Central Cape Town area.
‘Our research shows that short-term rental prices vary widely, from R950 per night to as much as R20 000 per night for luxury properties along the Atlantic Seaboard,’ says Schaefer.
‘At the same time, long-term rental prices in Cape Town remain significantly higher than in other major South African cities, with small studio apartments starting at around R5 000 per month and single rooms in shared houses at approximately R4 500 per month.’
Impact on sectional title complexes
For trustees and directors of sectional title (ST) schemes, the new regulations may provide long-awaited relief. Many sectional title complexes in Cape Town, Durban and Johannesburg have struggled to regulate short-term letting due to resistance from property owners who benefit financially from Airbnb.
‘In many complexes, we see a constant influx of short-term tenants, leading to security concerns, increased maintenance costs and difficulty enforcing conduct rules,’ says Schaefer.
‘While the Sectional Titles Schemes Management Act (STSMA) allows trustees to restrict or ban short-term letting through a special resolution, securing enough votes to implement these changes has been challenging – especially when multiple owners profit from Airbnb.’
However, the new regulations could change that. If investors opt to sell or switch to long-term rentals, there could be a shift in ownership priorities, with more emphasis on security, property values and tenant stability.
‘In the medium term, this may also help to encourage more sectional title owners to volunteer as trustees and be more willing to engage professional property management services to ensure well-run and compliant housing schemes,’ adds Schaefer.
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Picture: Cheng Xin / Getty Images
