If you run an Airbnb in Cape Town, you have probably heard about the "135% rate hike". That headline dates back to early 2025. Since then, the City has turned the idea into two concrete pieces of regulation: a change to how properties are rated, and a draft Short-Term Letting By-Law that requires every short-term rental to be registered. The details matter, because they decide whether your property stays on residential rates or moves to commercial ones. Here is where things stand in October 2026, what the rules actually say, and what hosts should do now. The Short Version - Every property listed on an online booking platform will need to be registered with the City and show a City-issued registration number on its listings. - A property that is used or available for short-term letting for more than 50% of its annual room nights will be treated as commercial accommodation and pay commercial property rates. - The City says it will start moving identified properties onto commercial rates from 1 July 2027. - Homeowners who occasionally let out their primary residence, and properties on long-term leases, are not the target. How We Got Here | When | What happened | |---|---| | February 2025 | The City announces plans to charge full-time short-term rentals commercial rates, reported as up to 135% higher | | April 2026 | Proposed changes to the City's rates policy, including the 50% room-night test, go out for public comment | | August to early October 2026 | The draft Short-Term Letting By-Law is open for public comment | | From 1 July 2027 | The City begins moving identified properties onto commercial rates | The public comment period on the draft by-law closed in early October 2026. The City still has to consider the comments and finalise the by-law, so some details may change before it takes effect. The 50% Room-Night Rule, Explained The key test is not how long your guests stay, but how much of the year your property is used or available for short-term letting. According to the City's FAQs, the maximum is your number of bedrooms multiplied by 365. A two-bedroom apartment therefore has 730 room nights a year. If more than half of those, so more than 365, are listed as available on booking platforms for short-term letting, the property counts as commercial short-term letting and moves to commercial rates. Two things stand out: - Availability counts, not only bookings. A calendar left open all year can push a property over the threshold even if it is not fully booked. - The City can see it. The draft by-law requires booking platforms to share availability and occupancy data with the City, so the calculation will be based on platform data rather than on what owners declare. Registration: What Hosts Will Have to Do Under the draft by-law, owners or operators must: - Register every property with the City before it is used, advertised or listed for short-term letting, providing details such as the physical address, erf number and municipal account number - Display the City-issued registration number on every listing for that property - Register again if the property is sold, as the old registration is cancelled on transfer Booking platforms will have to show registration numbers, refuse listings without a valid one and remove cancelled listings within ten working days. Breaking the by-law can lead to a fine, imprisonment of up to six months, or both. The City plans a grace period after the by-law is promulgated, with dates to be announced. Who Is Not Affected? The City has been clear that it does not want to stop residents earning extra income from their own homes. - Home-sharers: if you let out your primary residence occasionally and stay below the 50% threshold, your property remains residential. - Long-term leases: the City's FAQs state that properties rented on long-term leases are not considered commercial, because the property remains the tenant's primary residence. What About Monthly Stays? This is the question most of our hosts ask, and the honest answer is that the draft does not settle it. The by-law defines short-term letting as letting a furnished property to transient guests on a temporary basis, without setting a maximum number of nights. What the City's own explanation suggests is that the deciding factor is whether a property works as a hotel or as someone's home. A tenant who lives in your apartment for three or six months, works from it and treats it as their residence looks much closer to a lease than to a string of holiday guests. But until the by-law is final, nobody can say for certain how a stay of one to twelve months will be treated. We will update this article when the final wording is published. What This Means for the Rental Market For owners running apartments as full-time holiday lets, the numbers are about to change. Commercial rates, registration and data sharing all add cost and admin to the nightly model. Some owners will absorb it, some will return their properties to long-term letting, and some will move to longer stays, where turnover is lower and a property is used as a home. For Cape Town residents, the City's aim is to bring more homes back into the residential market, which is also why it has paired the rules with plans to speed up housing supply. What Should Hosts Do Now? 1. Look at your calendar. Work out how many room nights your property is listed as available for short stays each year, and how that compares with the 50% threshold. 2. Model the cost. Ask what commercial rates would mean for your margins from July 2027, using your current municipal account as the starting point. 3. Keep records. Lease agreements and the length of each stay will matter if your classification is ever questioned. 4. Prepare to register. Gather your erf number and municipal account number now, so registration is quick when it opens. 5. Consider longer stays. If the nightly model stops adding up, renting to tenants who stay one month or longer means fewer changeovers, lower cleaning and management costs, and a property that is lived in as a home. If you want to explore longer stays, roam&root connects Cape Town hosts with remote workers, relocators and professionals looking for furnished homes for one month or more. Listing is free. For a closer look at the trade-offs, read our comparison of Airbnb and monthly rentals in Cape Town and our guide on how to furnish an apartment for monthly tenants. Frequently Asked Questions Does Cape Town's new by-law apply to Airbnb hosts? Yes. The draft Short-Term Letting By-Law requires every property listed for short-term letting on an online platform to be registered with the City and to show a City-issued registration number on its listings, whichever platform it is listed on. When do the higher rates for short-term rentals start? The City says it will start moving identified properties onto commercial property rates from 1 July 2027. The by-law itself still has to be finalised after the public comment period that closed in early October 2026. What is the 50% rule for short-term rentals in Cape Town? A property that is used or available for short-term letting for more than 50% of its annual room nights is treated as commercial accommodation. Annual room nights are the number of bedrooms multiplied by 365. Do I have to register my property if I only rent it out occasionally? The draft requires registration for properties listed for short-term letting on online platforms. Occasional home-sharers who stay below the 50% threshold keep residential rates, but are still expected to register if they list on a platform. Are long-term rentals affected? No. The City's FAQs say properties on long-term leases are not considered commercial, because the property remains the tenant's primary residence. Are monthly rentals affected by the by-law? The draft does not set a maximum length of stay, so this is not yet settled. A tenant who lives in a property for several months as their home is closer to a lease than to holiday letting, but hosts should check the final by-law once it is published. What happens if I do not register? Platforms will not be allowed to display unregistered properties, and contravening the by-law can lead to a fine, imprisonment of up to six months, or both. This article reflects the City of Cape Town's published draft by-law and FAQs as of October 2026. The by-law has not been finalised and details may change. It does not constitute legal or tax advice; property owners should consult a qualified professional about their own situation. Sources: City of Cape Town draft by-law, City of Cape Town FAQs, public comment notice.