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Holiday rentals

Sep 20, 2018 | Featured, Investment

Leisure leasing

Investing in a property geared for holiday rental comes with its own challenges and requirements. While the income can be attractive, Natalie Muller, sales and rentals manager for Seeff Atlantic Seaboard and City Bowl advises considering certain factors.

Legislative landscape

Town and city councils have by-laws, which regulate the use of property. In the case of Cape Town, there is a comprehensive “Guest Accommodation Policy” which regulates the zoning and requirement. Guest accommodation is also regulated in terms of the Municipal Planning By-law of 2015. You can generally operate a B&B from a full title house without prior consent, but subject to certain conditions (like, not renting out more than three rooms), but it is more complex when it comes to sectional schemes.

Sectional Title Schemes

Sectional schemes are more challenging, and would only be permitted if zoned GR2-GR6, which most of Cape Town properties are. If not, then permission is required from the City’s Development Management Department. The Sectional Titles Act and the Sectional Titles Schemes Management Act (STSMA) also empowers a body corporate to make or amend appropriate rules and holiday rentals could therefore be blocked if problematic.

Agreement and governance

Janine van Heerden, rentals manager for Seeff Hout Bay and Llandudno says that it is important to have a detailed short-term lease to regulate the tenancy, deposit and payment terms, cancellation policies, breakages, complaints and general conduct. Set out all rights and responsibilities clearly. Note also that the CPA (Consumer Protection Act) and the PIE (Preventions of Illegal Evictions Act) do not apply to short-term rentals, but the Rental Housing Act applies as a holiday rental is still seen as a lease.

Contact Seeff SHORTSTAY on 021 434 9175; seeff.com

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