New laws for Airbnbs and other short-term rentals in Cape Town
The City of Cape Town has published a new draft Short-Term Letting By-Law for public comment, which will introduce a new registration system for Airbnbs and other short-term rentals in the city.
The draft by-law will require all properties listed on any booking platform to register with the city and display a registration number on all listings.
Booking platforms, owners and operators will also be required to share data on listing availability with the city.
According to the city, the new laws aim to improve compliance with its existing Rates Policy.
This already requires that commercial property rates be levied for premises used for commercial accommodation.
However, it noted that the commercial rates won’t apply to all rentals.
Properties with less than 50% room-night availability for short-term letting—such as people supplementing their income by renting out part of their primary place of residence for some of the time—will not face these rates.
“Commercial property rates only apply if a property is available for short-term letting for more than 50% of the total annual room nights,” it said.
“The 50% ratio is arrived at by calculating the portion of nights a property’s total bedrooms are available for short-term letting over a 365-day period.”
Commercial rates also do not apply to long-term rental properties that are the tenant’s primary place of residence.
The city said that the new registration system will make it easier to identify qualifying properties and ensure that the proper rates are applied.
Changes to a property’s rating category will be effective from 1 July 2027 based on data from the proposed registration system, it said.
“Over time, the city has been working to systematically identify properties used for commercial accommodation where residential rates are incorrectly being levied instead of commercial rates,” said MMC for Finance, Siseko Mbandezi.
“The proposed By-law ensures fairness in the commercial accommodation sector.”
The city said it will continue to engage with the commercial short-term letting sector and provide support.
It noted that the city’s tourism economy will be strongly supported in this regard, particularly as short-term letting services cater to “diverse tourist needs”.
“However, the city believes that the playing fields for businesses should be equal, with all those using a property for commercial accommodation paying the correct rates,” Mbandezi said
Airbnb and short-term rental platforms under pressure
The new draft by-law in Cape Town is the latest in a line of regulatory and policy proposals targeting short-term rental platforms in the country.
South Africa’s coastal regions, in particular, have seen a surge in short-term rentals cropping up, mirroring the opportunities and pitfalls of this micro-economy seen in other major global cities.
One of the key pitfalls blamed on the sector is rising prices and ‘grey area’ operation, as the platforms tend to be under-regulated.
Meanwhile, property owners take advantage of the demand for affordable accommodation, creating a scarcity of properties and pushing up prices.
This has led to a strong push to regulate the sector, even as some industry experts claim these criticisms are misplaced.
Earlier in 2026, policy proposals were published in South Africa, advocating the integration of these platforms into the mainstream tourism industry.
This would enforce regulations similar to those imposed on hotels, guesthouses, and hostels.
These could include mandatory registration with tourism boards, payment of hospitality taxes, and adherence to strict health and safety standards.
In March 2026, the Minister of Tourism, Patricia de Lille, published a Code of Good Practice for Short-Term Rentals for public comment.
This code also aims to provide guidance on responsible conduct within the short-term rental market. When in force, it will look at specific obligations, such as the duty to avoid excessive noise or disruption.
As the government finalises these new rules, Airbnb hosts, investors, and travellers will have to prepare for changes.
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