Airbnb has been calling for short-term rental regulation for a “very long time” and agrees the sector needs regulation. 

So said Velma Corcoran, Regional Lead Middle East Africa at Airbnb, who spoke to Tourism Update at the Airbnb Africa Travel Summit in Johannesburg this week.

“Now is the right time to create regulation that allows everyday South Africans to continue hosting, but that also gives government the data and the tools they need to maybe put in place stronger regulation for people who are doing it more professionally,” said Corcoran.

Corcoran referred to the recent Memorandum of Understanding (MoU) that was signed between Airbnb and the Department of Tourism.

“One of the things in the MoU is to work on a national registration system so that everyone that is doing short-term rentals has to register. This means that the Department will have the information that they need to understand what activities are happening, where it’s taking place, and then to go and look what regulation, if any, they need to put in place.”

Corcoran said that a lot of the time people heard “regulation”, which makes them think “clamping down”.

“I think there’s a way we can do short-term regulation so that it’s not necessarily clamping down.”

She referred to the Tourism Green Paper that is currently being tabled, which addresses short-term rentals.

“The Tourism Green Paper says ‘creating a differentiated system for regulating short-term rentals’ – which we absolutely agree with. There are some proposals in there that we think maybe should be refined or relooked, although there is still time for input. Only after the Green Paper has been passed will there be regulation.”

Corcoran believes that industry will see a slight scale of regulation that separates between people who are doing it as a side hustle versus people who are running it as a business – with less regulation for the former and more for the latter.

“If the regulation is done well, you can create a framework that allows someone who has a space in their home or a garden cottage to continue hosting, but you’re probably putting in place stricter measures and stricter regulation against people who have got five, ten, fifteen Airbnbs that are running it as a business.”

Opportunities

Corcoran said there were plenty of ways in which the number of hosts could be increased on the platform.

She believes the biggest opportunity to increase hosts is the ‘network effect’ and word of mouth.

“Word of mouth is really key for us. We have community host clubs and community leaders who are active in their communities talking to family, friends, and other people to entice them to host.”

Another massive opportunity is the Airbnb Entrepreneurship Academy, which is a skills development programme focused on spreading the benefits of tourism to historically disadvantaged individuals by lowering barriers to entry and providing economic empowerment.

“We are running the academy in partnership with local organisations. We’ve just done one in KwaZulu Natal, as well as in Gauteng.”

She added that Airbnb also had a partnership with the University of Johannesburg to start to develop a short course for hosting.

Furthermore, Airbnb also hosted the Africa Host Spotlight the night before the summit, which is an awards ceremony that recognises the best Hosts across the continent with different categories such as Best Design Stay, Most Sustainable Stay, and Best Rural Stay.

Airbnb saw around 700 hosts nominated for the awards.

Corcoran believes that Airbnb has helped to unlock domestic travel in the last few years.

She also mentioned that the high cost of living in South Africa was making people want to earn more money, and hosting on Airbnb was an ideal way to collect the needed additional income.

“Airbnb has seen a 33% increase in domestic travel from 2019 to 2022. This is due to South Africans wanting to travel, and Airbnbs are more affordable, accessible and in the destinations that travellers want to go to.”

Barriers

However, there are still challenges to increasing the number of hosts as well, such as uncertainty over whether people should or should not be hosting, and the fact that it is a lot of work.

There are also systematic barriers for more rural communities such as digital access, access to WiFi, concerns over safety and security, and load shedding (which makes hosting expensive).

Corcoran said Airbnb had created a guide for hosts on how to talk to their guests about load shedding. She also mentioned the recent partnership with Takealot which aimed to alleviate the pressure and cost of load shedding during the past winter.

Impact

During the Airbnb Africa Travel Summit, the online booking platform released the following statistics to show that Africa is a key region for Airbnb and tourism:

• Cumulative hosts’ income is over US$400m.
• Airbnb contributed more than R23.5 billion (€1.1bn) to the South African economy in 2022 – supporting almost 50 000 jobs.
• 53% of hosts say Airbnb helps them to cover rising living costs.
• Over 500 people have been trained through the Airbnb Academy.
• Seven out of the top-ten growing cities are located in less-travelled regions.
• Guests’ local spending is around R3 000 (€150) per day.