City’s tourism boost

Picture: David Ritchie/ANA

The City of Cape Town is in the process of conducting a survey to discover the impact that Airbnb has on the housing market.

This comes as an agreement between Airbnb and the City of Cape Town was announced last week. The City had signed a collaboration agreement with Airbnb that will focus on “inclusive tourism”.

The agreement will also see Airbnb promoting Cape Town as a tourism destination.

This was announced at a press conference on Wednesday October 18.

The City of Cape Town also says they are busy conducting a survey to evaluate the impact of Airbnb on property prices and short-term rentals.

Airbnb, a digital house-sharing platform, has been cited by housing activists as a reason for escalating housing prices in Cape Town.

Since starting as a company in 2008, hosts on Airbnb have welcomed over 200 million guests in 191 countries.

In Cape Town there are 17 600 active listings on Airbnb and hosts have earned a combined income of R762 million over the past 12 months, welcoming close to 290 000 visitors.

The average host in Cape Town earns an additional R43 400 by sharing their home for 32 nights a year. The Atlantic Seaboard and City Bowl remain the most expensive in terms of places to visit.

Chris Lehane, Airbnb’s global head of public policy and public affairs, said he was excited about the partnership with the City.

“This is one of the most amazing cities in the world. It (the partnership) does focus on inclusive tourism. Cape Town will also be the home of the first summit on inclusive tourism.”

He said around 89 percent of hosts stay in “non-traditional hotel districts”.

This, says Mr Lehane, means that the benefits of tourism also get spread more evenly. “What we also see is that as the platform becomes more well known, you really see that migration into other parts of the city. One of the things we have been working on is a host-empowerment programme, so that we are able to increase the number of hosts in non-typical areas.”

He said that the majority of hosts in Cape Town, according to their data, were women. “Cape Town has the highest number of hosts in South Africa and what we’ve seen is that our hosts here get some of the highest ratings of any hosts in the world. People really do welcome into their families. I do think that is one of the reasons why it has become such a successful place for us and why we’re committed to being here. “

He said the idea for Airbnb came about from being able to leverage your biggest expense, which is your home, and use it to help you economically.

When asked about Airbnb’s impact on the ever-increasing rental prices on the Atlantic Seaboard and City Bowl, he said he welcomed regulation.

“We should figure out what impact, if any it is having. Typically there is a variety of factors driving the housing challenge in any particular city but we certainly want to be part of the solution. We are committed to working with the City.”

Mayo, Patricia De Lille welcomed the partnership at a press conference last week. “The City of Cape Town is building an opportunity city that creates an enabling environment for inclusive economic growth and job creation. The sharing economy has the ability to welcome more Capetonians into the tourism sector, in line with our efforts to build an inclusive city as we welcome more Airbnb guests. Cape Town is a globally competitive destination and we are creating the space for all entrepreneurs to excel,” she said.

Ms De Lille admitted that as the City, they were lagging behind in terms of regulation on Airbnb and that was one of the reasons for conducting the survey. “In the time when we did our by-laws, Airbnb were not really that prominent in the city. We are now busy with a survey because we need to balance the impact of short-term rentals. As the market has developed organically, as city we have to catch up.”

She added that she had looked at Airbnb regulations in cities such as Paris.

She said that the residential survey on Airbnb closed on Friday October 27.

“Once we have completed the survey we will also start engagement with a number of stakeholders on how it impacts on the rental market in the industry.”

Janine Myburgh, President of the Cape Chamber of Commerce, said that at present the tourism industry is concentrated in a few select areas. “One of the things Airbnb will do is to spread the industry more widely, bringing the benefits of tourism to more areas of the city and to more people.”

She said there was not necessarily a direct connection between Airbnb and an increase in property price. “What pushes up property prices is the law of supply and demand. With many more families moving to Cape Town each month, the demand for housing increases and a rise in property prices is almost inevitable. Airbnb may be a contributing factor but at this stage it seems unlikely to be significant.

“Tourism has been one of the great success stories of the Western Cape and it continues to grow nicely so the people involved are getting it right and we should leave it to them as far as possible. They understand the market and the competition and are in the best position to assess and deal with the new competition.”

When asked about regulation, she said: “South Africa is an over-regulated country and that means more red tape and less efficiency. The chamber’s view is that there should not be regulation unless absolutely necessary.”

Enver Duminy, CEO of Cape Town Tourism, said the fact that more locals have access to share in the tourism economy is significant as it will provide income and stimulate business across the city. “

When asked about regulation, Mr Duminy added: The City of Cape Town is working with Airbnb to ensure that a fair, responsible approach is taken that provides visitors with the security that their stay will be a good one. The regulations that exist within hospitality, tourism and real estate are sufficient. It’s a matter of ensuring that they’re applied.”

Mr Duminy said that while the Atlantic Seaboard and City Bowl remain the most popular for tourists, it is a good thing for business to be spread it out.

“We’re a city of many cultures and personalities that appeals to all sorts of travellers seeking a variety of experiences – the City Bowl and Atlantic Seaboard are popular for their central location, but neighbourhoods such as the Northern Suburbs, Blouberg, the South Peninsula and Somerset West are also favoured for their competitive pricing and relaxed atmospheres, while Langa and Khayelitsha offer an immersive, community experience.”