Airbnb is once again in the spotlight. From record tourism numbers to renewed debate around housing shortages in cities like Cape Town, short-term letting has shifted from side hustle to serious business. But as more owners tap into demand from swallows, digital nomads and long-stay visitors, pressure is building inside apartment blocks where the rules were never designed for revolving doors of guests.
Airbnb listings have grown steadily, with tens of thousands of active listings nationally, often competing directly with hotels and guesthouses. While hotels remain regulated and structured, Airbnb’s flexibility has made it attractive for both travellers and property owners. The flip side? A tightening rental market, with long-term housing stock increasingly diverted into short-term accommodation.
For many sectional title schemes, this is where the friction starts.
When ownership meets rules
When a development is established, it comes with management and conduct rules that bind all owners. In newer schemes, short-term letting is often specifically addressed. In older buildings, it’s a grey area that is now being tested.
“At its core, these disputes are rarely about Airbnb itself – they’re about whether owners are complying with the rules they agreed to when they bought into the scheme,” says Kayley Leverton, Senior Associate at Gillan & Veldhuizen Inc.
In a recent matter, a body corporate had clear conduct rules restricting short stays below a certain number of days. Despite repeated warnings and fines, several owners continued operating Airbnb units in contravention of the restricton.
“The body corporate ultimately had to approach the High Court for an interdict,” Leverton explains. “The court granted the order, requiring the owners to stop the short-term letting. If they continue, they face contempt of court.”
It’s a reminder that “ownership rights are never unlimited,” she adds. “They are always subject to the scheme’s rules and applicable law.”
The balancing act: income vs impact
There’s no denying the appeal. Short-term letting can generate significantly higher returns than traditional leases, particularly in tourist-heavy areas. But that upside is being weighed against very real downsides: noise complaints, security concerns, increased wear and tear on common property, and a sense of transience in what were designed as residential communities.
At a broader level, the conversation has moved beyond individual buildings. As more units shift to short-term letting, fewer remain available for long-term tenants, pushing up rental prices and limiting access for locals. That debate is gaining traction, but for now, it sits largely outside the courtroom.
“Our courts apply the law as it stands,” says Leverton. “The broader housing debate is unlikely to influence outcomes unless and until legislation changes.”
That said, change may be coming. Proposed amendments to tourism legislation aim to create a more balanced framework between economic growth and housing needs.
SARS, rates and the compliance catch-up
Another shift happening quietly in the background is compliance. “SARS is certainly getting wise to the income being generated from short-term rentals,” Leverton notes.
Many owners are unaware that short-term letting (typically under 28 days) is not VAT-exempt, unlike long-term residential rentals. Add to that municipal considerations: the City of Cape Town requires properties used for short-term letting businesses to be reclassified and charged commercial rates.
“It’s questionable how many owners are actually updating their property status,” she says, pointing to proposed by-laws aimed at tightening enforcement. For those running multiple units or operating at scale, the gap between “side income” and “commercial activity” is narrowing fast.
Where disputes really land
When things escalate, body corporates have a few options: internal enforcement through fines, referral to the Community Schemes Ombud Service (CSOS), or court proceedings. But litigation is not always straightforward.
“These processes can be costly and time-consuming, and not every body corporate has the resources to pursue them,” Leverton explains. Each case is also fact-specific. Not all conduct rules are the same, and enforcement depends heavily on how clearly those rules are drafted and applied.
So, what should owners (and trustees) be doing?
For anyone currently running – or considering – short-term letting an Airbnb in a sectional title scheme, the starting point is simple: read the rules. “If the conduct rules restrict short-term letting, those restrictions will generally be upheld,” says Leverton. “Ignoring them is what leads to disputes.”
For schemes without clear provisions, the window to act is before problems arise.
“If there’s an appetite to regulate short-term letting, the rules need to be amended properly, by special resolution,” she says. “And that requires a 75% vote – which can be difficult to achieve once opinions are divided.”
Her practical advice:
- Review your scheme’s conduct rules in detail
- Start conversations early if changes are needed
- Keep records of complaints and disturbances
- Treat short-term letting as a regulated activity, not a loophole
Not going anywhere
Short-term letting isn’t a passing trend. It’s a global shift in how people travel, work and live – and South Africa is firmly part of that story.
“Short-term lets are not going anywhere,” says Leverton. “Schemes need to decide what works for their community and align their rules accordingly.”
For owners, the message is just as clear: the opportunity is real, but so are the rules.