Six years after initiating efforts to regulate the short-term rental market, the Department of Tourism has yet to implement any national rules – leaving traditional hospitality businesses to operate in an increasingly uneven playing field as platforms like Airbnb and Booking.com continue to thrive.

In a written response to News24, Tourism Minister Patricia de Lille confirmed there are “currently no national regulations for the short-term rental market in South Africa”.

The Department of Tourism initially paused its proposed regulatory changes to conduct a comprehensive policy review. De Lille stated that government is now ready to proceed. “With a new strategic direction, the department will soon start working on the amendment that will create regulations for the sector.”

The prolonged delay caused growing concern within the traditional hospitality industry, which argues that the absence of national regulation has created unfair competition, undermined compliance standards and stalled efforts to stimulate meaningful job creation through tourism.

Rosemary Anderson, National Chairperson of FEDHASA, believes the time for regulation is now.

“Regulating South Africa’s short-term rental market is long overdue. However, the delay presents an opportunity: we can learn from the successes and failures of other countries that have already implemented Airbnb regulations, avoiding unintended consequences that could harm our tourism sector and economy,” Anderson told Tourism Update.

Anderson pointed to international examples as cautionary tales. She highlighted Spain, New York and Scotland – countries and regions where poorly designed regulations have led to unintended fallout such as surging hotel prices, decreased accommodation availability and collapse in rural tourism.

“Several international examples illustrate how poor regulation can backfire. In Spain, heavy restrictions on short-term lets in cities like Barcelona led to a decline in available accommodation, driving up hotel prices and reducing tourism competitiveness. In New York, strict licensing laws significantly cut Airbnb listings, forcing visitors to seek alternative destinations, which hurt local businesses reliant on tourist spending.

“Similarly, Scotland’s recent stringent regulations led to a dramatic reduction in short-term rental availability with many small traditional businesses closing down. This caused an outcry from property owners and negatively impacted tourism in rural areas while driving up hotel prices in the cities. For South Africa, getting regulation right is critical – not just for fairness in the hospitality sector but also for economic growth and job creation.”

FEDHASA’s stance is that regulation should be fair, balanced and crafted with South Africa’s unique tourism and economic context in mind.

Anderson argued that a well-structured regulatory framework should:

• Ensure short-term rental hosts comply with basic safety and insurance requirements, protecting guests and property owners.
• Level the playing field between Airbnb-style rentals and traditional hospitality businesses without imposing excessive costs that stifle entrepreneurship.
• Address South Africa’s high unemployment rate by ensuring new rules support rather than hinder job creation in tourism.

Rather than applying hotel-style compliance standards to informal hosts, Anderson urges a fresh and holistic approach.

“The key is balance. Simply applying the extensive, and costly, regulations of hotels and guesthouses to short-term lets would be counterproductive. Instead, authorities should review existing hospitality regulations with fresh eyes; reducing unnecessary red tape for hotels and guesthouses while introducing fair, necessary compliance for short-term rentals.”

Anderson also stressed that meaningful reform must tackle deeper structural issues in the hospitality sector.

“Additionally, and most importantly, if government views tourism as a vital job creator, addressing prohibitively high municipal rates and operational costs for hotels must be part of the solution. A holistic, well-planned approach can ensure a thriving, competitive and sustainable accommodation sector in South Africa.”