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Legalbrief   |   your legal news hub Monday 27 May 2019

Self-regulation of short-term rentals a better bet

The new Tourism Amendment Bill – the so-called Airbnb Bill – has far-reaching consequences for entrepreneurs who rent out rooms in their homes. ‘Further increases in the government-imposed regulatory compliance burden in SA – including on small business owners in the short-term home rental market – are ill-advised,’ says business organisation Sakeliga’s Gerhard van Onselen. ‘Government shouldn’t level the playing field by making it equally difficult for everyone, but rather by making it equally easy,’ he says in an analysis of the draft Bill on the Politicsweb site. Arguing that the provisions in the Bill are loosely defined and delegate too much ‘arbitrary’ regulatory authority to the Minister, he says regulations which could eventually result from the Bill will increase the cost of Airbnb type hosting and cap the income opportunities of property owners in the short-term rental industry. ‘Excessive regulation will eventually be most harmful to the consumer. At present, short-term home leasing services offer a convenient and low-cost possibility for people in need of accommodation.’ However, if this amendment is passed, ‘it is likely to result in more expensive and less pleasant accommodation’, Van Onselen says. He suggests an alternative: If short-term leasing services are given an opportunity to apply self-regulation, it will create a precedent that ultimately could also be used to revise improper regulation in other parts of the accommodation industry. ‘However, the opposite also applies – if excessive ministerial intervention is allowed in this instance, it will strengthen government’s hand in further intervention in the established hospitality businesses at a time when existing regulation should itself actually be reconsidered.’