As short-term rentals are becoming more favourable among travellers and homeowners alike, many South Africans are exploring the option of listing their properties on online marketplaces to generate extra income. But before you flip your garage into a short-stay option, there’s various legal, financial, and practical implications homeowners should consider before becoming a host.
According to Adrian Goslett, CEO and Regional Director of REMAX Southern Africa, before a homeowner considers listing a property, they need to assess whether the property is truly suited for short-term letting and can be profitable.
“Short-stay rentals can be profitable if located in the right area and set up properly but, they require far more hands-on work and management than many homeowners expect,” he explains. “Instead of viewing it as an easy avenue towards a passive income, homeowners should treat short-term rentals as running a hospitality business.”
Goslett advises that homeowners should start by navigating the legal framework of short-stay accommodation first before listing a property. In South Africa, this is primarily regulated by the Tourism Act 3 of 2014. The first is to check if your city or zone has rules that restrict short-term rentals or holiday stays. Ensure that you confirm what rules apply to your property, especially if it is within a sectional title scheme or estate.
“Many complexes have conduct rules that restrict short-term letting, require approval from the body corporate, or limit the number of occupants allowed. Even if it is permitted, owners may be responsible for ensuring guests comply with noise regulations, parking restrictions, refuse rules, and visitor access procedures,” he says.
Homeowners should also consider the insurance implications of hosting. Standard homeowner’s policies may not automatically cover short-term rentals, and some insurers require disclosure or offer specialised cover for short-stay hosting. As a host, you need to ensure that you are covered for accidental damage, theft, liability claims, and even loss of income if the property becomes uninhabitable due to an incident.
Outside of the daily operational responsibilities, hosts need to understand the tax implications of the short-term rentals as any earnings need to be declared to SARS, and owners may have to keep accurate records of earnings and deductible expenses.
Goslett adds that maintaining the property to a high standard is another major factor in the long-term success of a short-stay accommodation as guest expectations and online reviews can make or break a listing. Additionally, pricing strategy is key as owners should factor in platform fees, cleaning costs, utilities, wear and tear, and vacancy periods when calculating profitability. It may also be necessary to invest in security measures such as smart locks, alarm systems, or access control to help manage guest turnover safely and efficiently.
Goslett advises homeowners who are uncertain whether short-term letting suits their area or property type to consult a trusted real estate professional who understands local demand trends, pricing expectations, and the long-term impact on the property’s market value.
