Demand for Airbnb boosts sectional title property, but beware the rules
Category Newsletter: Article
There is little doubt that Cape Town’s CBD and Atlantic Seaboard rank amongst the most sought-after areas for short-term rentals. The arrival of Airbnb, has naturally boosted the demand as many property owners and prospective buyers want to get in on the opportunity of earning excellent returns.
The city now boasts an extended tourist season, starting in around October and lasting until end April. Self-catering styled accommodation is a popular option for its affordability compared to hotels and guest houses and the greater flexibility that it offers.
There is though, a notable difference between traditional long-term rentals and short-term, Airbnb-type of rentals where tenants tend to stay for a day to about twee weeks maximum on average, although stays can range up to six months. This means plenty of disruption, especially for sectional title property schemes where people live in close proximity and the security of people coming and going often a concern for residents.
Although short-term letting is not defined as such in the governing sectional title legislation (Sectional Titles Act 95 of 1986 and Sectional Titles Schemes Management Act 8 of 2011), there are guidelines for rentals or ‘occupiers’ that property owners have to adhere to. This includes notifying the Body Corporate when a unit is rented out and attaching the conduct rules of the scheme to the lease agreement, thus making the new occupier aware of the relevant rules and regulations.
When it comes to short-term rentals, it becomes more challenging to manage occupiers and many schemes are beginning to put specific rules in place. This is understandable, given the associated risks, from the constant coming and going of people to aspects such as noise, visitors and parking.
Many complexes close to the Cape Town Convention Centre, the sports stadia and popular beaches make for excellent rental options for holiday makers and business visitors. Property owners should therefore not be deprived of the opportunity to earn excellent rental returns on their property investment.
At the same time, property owners need to ensure that the renting out of their unit (or units as is sometimes the case), do not cause issues that may compel the scheme to restrict short-term rentals. To assist with this, managing agents are increasingly entering the realm of rental management, not just long-term rentals, but now also short-term rentals.
Sectional title schemes come with many aspects that need to manged, not just the actual living arrangements, but access to the complex. For security reasons, many complexes are particularly guarded about giving out access codes. These risks including aspects such as the constant flow of people coming and going, can now be mitigated by making use of a rental agent that is already working with the scheme.
The added advantage for property owners, is that rental agents such as Coastal Property Sales and Letting will extend the online presence beyond Airbnb to ensure the property is listed on as many online portals as possible. There is a lot of online competition and plenty of listings, so a dedicated agent will assist with not just ensuring that your property stands out, but setting the rental rate at a competitive level so as to attract maximum occupancy.
At the same time, the rental agent will ensure integration with the rules and regulations of the particular scheme and manage the visitors.
Author: Coastal Property Group
