| 17 April 2026 |
| Dear Cape Town Metro Property Owners, Cape Town’s Rates Policy requires that commercial property rates be paid for premises used for commercial short-term letting. This does not apply to people supplementing their income by renting out some of their residence for some of the time.To improve compliance for commercial short-term letting properties incorrectly paying residential rates, a draft Short-Term Letting By-law will go out for public participation in due course.In preparation for this, the City’s proposed Rates Policy 2026/27 includes updates related to the forthcoming By-law to improve compliance for premises that should rightfully be categorised as commercial tourist accommodation (short-term letting).This will further ensure fairness in the commercial accommodation industry, with all those using a property for commercial short-term letting paying the correct rates category required of a commercial business – as hotels, guesthouses, and BnBs already do. |
Which properties used for short-term letting will be considered commercial?Per the proposed amendments to the City’s Rates Policy, properties are considered commercial if they are available for short-term letting for more than 50% of the total annual room nights (the portion of nights a property’s total bedrooms are available for short-term letting over a 365-day period). Note: Properties rented out on long-term leases are not considered commercial as the property remains a primary residence for the tenant. |
| The amended Rates Policy is available for public comment until 30 April 2026 as part of the City’s broader draft Budget public participation process. The updated Rates Policy will be tabled for adoption by Council in May 2026 for implementation from 1 July 2026. The City will enact a grace period for owners to adapt to the new system. It is foreseen that from 1 July 2027, the City will begin moving identified properties over to commercial property rates where applicable.Later in the year, we will release a related draft Short-Term Letting By-law. This will also be available for public participation and will outline all the processes for implementing the proposed amendments in the Rates Policy.You can find more information in the Frequently Asked Questions (FAQ) document which should be read alongside the draft of the amended Rates Policy.City of Cape Town |
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