Airbnb calls for registration in South Africa, new data on housing impact

Airbnb has today written to the South African government with a call to accelerate the  implementation of a national host registration system that would give authorities better visibility of hosting activity in their area and inform additional measures where needed. 

The call comes as new research from Airbnb analyses the impact of short term rentals on Cape Town’s economy and housing market, which shows little to no correlation between Airbnbs and rising rents. 

Dedicated listings¹ on Airbnb, homes which are shared more than the typical listing, accounted for less than 0.9 percent of all formal housing units in the city, which is less than 1.5 percent of the number of additional housing units needed to meet growing housing demand over the next four years. 

The analysis on the impacts of hosting also shows that stays on Airbnb contributed an estimated R14.4 billion to GDP and supported 42,000 jobs in Cape Town in 2023 alone. Survey data from hosts also shows that for around half, hosting is an economic lifeline that actually helps them afford their homes.

Following the findings of this analysis, Airbnb has written to the South African government with a call to accelerate the introduction of a national registration system for South Africa. Airbnb’s letter recommends a national host registration system to boost transparency on hosting activity and help ensure that Cape Town and other cities are equipped to introduce additional targeted rules based on clear evidence, if needed.

Velma Corcoran, Regional Lead for Middle East and Africa, said, “Hosting on Airbnb provides much needed income to families in South Africa and supports thousands of jobs across the wider economy. As short-term rentals play an increasing role in South Africa’s tourism economy, we are calling on the government to accelerate the introduction of a national registration system that gives authorities better visibility of hosting activity in their area. Data from a register of hosts can then inform targeted and proportionate steps to  regulate activity, where there is a clear need. We look forward to continuing our positive work with authorities in South Africa.”

Here is a summary of the report’s findings: 

• In 2023, hosts on Airbnb welcomed more than 700,000 guests arrivals to Cape Town who contributed an estimated R14.4 billion annually to GDP², including:
  • 42,000 jobs supported³
  • R7 billion in labour income⁴
• Dedicated listings  in Cape Town represent just 0.9% of all formal housing units—less than 1 in 100—in the city.
  • This represents less than 1.5% of the number of additional housing units needed to meet growing housing demand over the next four years.
• In the four years from January 2020 to January of 2024, the total number of active stayed listings in Cape Town did not increase significantly. However,  rents continued to climb, implying there is little to no correlation between Airbnbs and rising rents. 
• If Airbnb listings booked for more than 90 nights per year were suddenly added to long-term rental supply (an unrealistic assumption), it would lead to an average reduction in rent of only R69 per month.⁵ 
• In total, hosts in Cape Town earned nearly R2.5 billion in 2023. In Cape Town, a typical listing is rented for 38 nights a year with a typical host earning R74 000 in the year. Eliminating the revenue earned through Airbnb would be a major economic blow to these hosts, in some cases undermining their ability to afford to live in the area.
• Almost half of hosts say that the extra income from hosting helps them:
  • Afford their homes (48 percent)
  • Afford the rising cost of living (50 percent)
• Almost half (47%) say the current economic climate is driving them to host more.

The full report is available here.

¹ Dedicated rentals are defined as entire-home listings on Airbnb that were booked for more than 90 nights in 2023.

² Economic contribution metrics are generated using IMPLAN’s input-output model using multipliers from the 2022 data year (the latest available at the time of analysis) for  Cape Town, and are reported in 2023 dollars. Model inputs are host earnings & guest spending, where spending is based on a survey of Airbnb guests staying in Cape Town. 

³ Estimated number of full-time, part-time and seasonal jobs supported by the output generated by Airbnb activity. This metric includes direct, indirect, and induced effects. 

⁴ Labor income includes both Proprietor Income (e.g. for small business owners that benefit from guest spending), but also Employee Compensation (e.g. cleaners, employees of small businesses). More details here. 

⁵ The model we use to estimate the impacts of converting Airbnb listings to long-term rental units is simple and transparent: We count the number of units to be converted, and translate that to price changes based on elasticities as reported in Saiz (2010). We use a supply elasticity of 0.595 for Cape Town (the most inelastic major metro in the paper).