Airbnb compliance – the journey ahead

Following up on The Village NEWS’ recent article about municipal compliance requirements for short-term letting, our research has revealed how lengthy the process may be, as well as the fact that the potential costs will not be light on the wallet.

It is a complex and time-consuming process, the essence of which is that you are applying for the rezoning of your property, and in doing so, will need to supply a myriad of supporting documents.

The involvement of experts may be necessary, as the intricacies of providing the correct information and documentation as well as distinguishing between the various options may be too daunting for the lay person to navigate.

As for the timeframes, expect at least six to eight months before compliance is confirmed. If there are any objections to your application, the process could take up to 10 months.

And then, of course, there is the cost factor, starting at R4 798 for a 150m₂ to 400m₂ erf and R6 688 for an erf of 400m₂ to 5 000m₂. Add to that the professional fees and you can expect to be at least R 8 000 to R 12 000 out of pocket. On the other hand, considering that the municipality is seeking to introduce ‘discipline’ and ‘control’ into the short-term letting market, can you afford not to comply?

From discussions with various Airbnb hosts or those using similar online portals, there appears to be a three-way divide on the view of compliance. The more established properties with a solid track record of repeat bookings and top-quality reviews are willing to go through the process as they see themselves as on a par with the registered and compliant guest houses and B&B establishments and are, anyway, fully-fledged tourist accommodations.

People who are using the online booking platforms as, first and foremost, an easy way to earn an income rather than establishing a proper tourism business are less inclined to comply with the regulations as they see it purely as a money-making initiative by the municipality.

Then there is the group that emphatically refuses to consider submitting an application as they do not believe that any action will be taken, based on previous unsuccessful attempts to enforce these regulations. They await the legal process of fines and penalties with a sense of glee and are clearly prepared to test the system.

Only time will tell how these applications are dealt with and how the monitoring and control will be implemented. When all is said and done, there are many concerned people who could potentially lose the income they rely on from their short-term rentals. Whether this is any cause for concern for the powers that be remains to be seen.

Airbnb by Numbers

Dec 2017
Available 1 725
Booked 1 491
ADR R2 409
Occupancy 55%

Dec 2018
Available 2 262
Booked 1 935
ADR R2 285
Occupancy 54%

 

Definitions:

■ Available Listings – The count of Airbnb listings that were advertised
for rent during the month or had a booked day in the month.
■ Booked Listings – The count of Airbnb listings that had at least one
booked day in the month.
■ ADR – The Average Daily Rate charged for the entire establishment
listing booked. ADR includes cleaning fees but not other Airbnb service
fees or taxes. The average USD/Rand exchange rate for the month is
used.
■ Occupancy – Booked Listing Nights divided by Available Listing
Nights.

Data courtesy of www.airdna.co

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