Festive Rentals Surge: The short-term boom boosting property value

• SA’s festive rental boom drives exceptional yields and strengthens long-term property values.
• Coastal hotspots and key urban hubs outperform on occupancy and revenue.
• Smart management, compliance and pricing strategies maximise returns and investor appeal.

A new wave of short-term letting demand

‍South Africa’s short-term rental market is entering its most lucrative period of the year. December and early January bring a rush of holidaymakers to coastal hotspots - Cape Town, the KZN North Coast and the Garden Route delivering a powerful revenue spike that many owners rely on.

But this boom is doing more than just filling pockets. It’s reshaping how investors value property.

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“Short-term letting has evolved from a side hustle into a legitimate investment strategy,” says Grant Smee, CEO of Only Realty Property Group. “Airbnb, Booking.com and similar platforms allow owners to earn consistently if they manage their units well — and buyers are starting to price that into what they’re willing to pay.”

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Smee adds: “Homes that perform well over the festive season increasingly command a premium. Income-generating potential has become a major factor in how investors evaluate property.”

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Coastal markets and lifestyle hotspots lead the charge

‍According to Airbtics, coastal markets dominate:

• Cape Town: 71% festive occupancy, R433,000 average annual revenue
• KZN North Coast: ± R479,000 annual revenue
• Durban: ± R258,000 annual revenue
• Johannesburg: ± R154,000 annual revenue

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“These numbers show just how lucrative festive-season letting can be,” says Smee. “Coastal markets surge, but urban hubs like Sandton and Rosebank are seeing growth too, especially as domestic travellers mix leisure with work.”

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Even once the holiday season ends, demand doesn’t collapse. “Digital nomads, contract workers and business travellers have made short-stays a year-round opportunity. Apartments near airports, universities and mixed-use nodes perform exceptionally well,” he explains.

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How short-term rentals add property value

‍Short-term rentals offer a dual benefit, high yields now and stronger capital appreciation later.

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“We’re increasingly seeing agents highlight proven rental performance in their listings,” says Smee. “Investors are willing to pay a premium for properties with reliable occupancy and income, especially in regulated estates and sought-after tourist areas.”

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However, he warns of the flip side: “Badly managed short-term rentals can damage reputations, disrupt neighbours, and depress values. Regulation and responsible management are essential.”

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Understanding the Rules: Compliance matters

South Africa’s short-term rental landscape is becoming more defined:

• Rental Housing Act governs responsibilities and maintenance even for short stays.
• Cape Town’s municipal by-law limits stays to 30 consecutive days per booking.
• A Gauteng High Court ruling confirmed that HOAs and body corporates may restrict or regulate short-term letting.

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“This ruling formally recognised short-term letting as a commercial activity,” says Smee. “It gives HOAs the authority to enforce rules that protect residents, security and amenity. Clear regulation helps both investors and communities.”

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Top Tips for Short-Term Letting Success

1. Prioritise guest experience

‍High-quality photos, spotless presentation, smooth check-ins and thoughtful touches drive five-star reviews.

2. Invest in fast turnovers

‍Peak season requires professional cleaning and quick turnaround capability.

3. Stage for your market

‍Highlight the right features: workspace and Wi-Fi in urban hubs; outdoor areas, pools and load-shedding resilience on the coast.

4. Use dynamic pricing

‍Track demand around public holidays and major events. Adjusting rates can push yields 10–20% higher.

5. Stay compliant and protected

‍Meet municipal rules, ensure proper insurance, and declare rental income to SARS. Deductible expenses — cleaning, maintenance, agent fees, can significantly soften the tax load.

The season is short, the value Is long-term

‍As Smee puts it: “The festive boom may last only a few weeks, but its influence on the property market lasts all year.”

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Short-term letting delivers immediate cash flow while strengthening long-term valuations, making it one of South Africa’s most compelling asset-leveraging strategies.

With proper management, transparent compliance and smart pricing, homeowners can turn holiday demand into sustainable property growth and investors are increasingly taking notice.

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