Pushed out: How rising rents and short-term rentals are displacing families in Cape Town

Alexander Hayes thought she had found a small but safe place to call home.

Instead, the single mother (30) to a two-year-old is now homeless — pushed out of a garden cottage in Heathfield, Cape Town, as the property was earmarked for short-term holiday rentals.

Hayes is currently moving between friends’ homes, relying on goodwill and spare couches to get by, after being told the cottage she rented would be converted into an Airbnb.

“I was living in a little cottage on someone’s premises because it was all I could find,” Hayes told IOL.

“The owner said I had to move because they were turning it into an Airbnb.”

Hayes’ situation surrounding housing is not an isolated incident.

It forms part of the Mother City’s ever-growing housing crisis, where rising rents, stagnant wages and the rapid spread of short-term holiday rentals are squeezing low- and middle-income residents out of the market.

Recent studies and official data paint a bleak picture.

According to Statistics SA, housing costs have risen far faster than wages over the past decade, while the City of Cape Town has acknowledged a growing shortfall in affordable rental stock, particularly for households earning below R22 000 a month.

Housing advocacy groups say the problem was most acute in well-located suburbs close to transport routes, schools and jobs — the very areas increasingly being snapped up for short-term letting.

A 2023 study by the African Centre for Cities found that thousands of long-term rental units in Cape Town have been converted into short-term accommodation over the past five years, significantly reducing the supply of affordable housing.

The study says the trend was “actively displacing working-class residents” and placing added pressure on informal settlements and overcrowded homes.

Researchers also found short-term rentals tend to cluster in southern and central suburbs, including parts of the Cape Flats, where demand for affordable housing is already high.

While the metro has defended short-term rentals as a boost to tourism and local income, critics argue regulation has failed to keep pace with the impact on residents.

South Seas Properties owner Christina Masureik says Cape Town was “in a real housing crisis”.
Masureik says it was important “to be honest” about what has been driving it.

“The city’s population has grown by almost 30% since 2011, and the number of households has grown even faster,” she says, adding her company was a member off the SA Short Term Rental Association.

“That puts huge pressure on housing supply, especially in well-located areas.

“At the same time, the city has a housing backlog estimated at around 400 000 households.”

She says in certain high-demand areas, short-term rentals have contributed to tighter long-term rental supply and higher rents.

“Research using Inside Airbnb data shows that Cape Town has tens of thousands of short-term listings, and a large majority are entire homes rather than spare rooms,” Masureik says.

“That means they directly compete with the long-term rental market in those specific areas.”

However, citywide, short-term rentals still make up a relatively small percentage of total housing stock, she adds.

“The impact is very localised. In neighbourhoods with high tourism demand, the effect is noticeable.

“In many other parts of the city, the main driver of rising rents remains limited supply and growing demand.”

AFP says University of Waterloo researcher Cleo St-Hilaire estimated about 1.5% of Cape Town’s total housing stock has been lost to Airbnb.
In Sea Point, a popular tourist hub during the festive season, that figure rises sharply to about 26%, she says.

City spokesman Luthando Tyhalibongo says Cape Town’s housing crisis was not driven by Airbnb, but by a lack of supply.

He saya the city simply does not have enough homes to meet demand.

Cape Town’s population stood at more than 4.7 million in 2022, according to census data — an increase of nearly 28% since 2011, placing further strain on the housing market.
Back on the ground, Hayes says the crisis becomes painfully clear when trying to secure even the most basic accommodation.

“I’ve applied for so many places, even community housing,” she says.

“But even a single room can cost about R8 000 a month. To qualify, you’re expected to earn three times that, which just isn’t realistic.”

She says she was stunned by what landlords now consider acceptable.

“I found an 18-square-metre shed going for R8 500 a month,” Hayes adds. “That’s not a home; that’s desperation being marketed as housing.”

To put it in perspective, it is roughly the size of two standard single SA prison cells combined.
Hayes says she began researching income levels to understand how families were expected to survive.

“Everyone is angry that we’re losing this city to people who are not from here. Even if I do find a place within my budget, I am in competition with six other people.”

Independent economist Ulrich Joubert says more and more people are selling off their homes as job cuts become way too common.
Joubert says Cape Town is not the only city struggling with lack of housing for citizens.

“We must rethink the type of housing that we provide. There are all these high-rise buildings, there must be urban spaces between them.

“The private sector could start building properties specifically for people to rent. That might not be a government solution but society that would provide for the demand.”

The world-famous city is, according to the economist, lacking in land.

“There is only so much land available in and around Cape Town. Where would you build in the city centre? I don’t think there are enough spaces.”

– IOL News

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