POLITICALLY AWEH: Why is rent so expensive in Cape Town, and would rent control help?

Cape Town property prices have risen about 30% since the end of 2020, well ahead of every other metro, according to Stats SA. The average rent in the city is now about R12,500 a month, up nearly 10% in a year. Even the Freedom Front Plus’s Corné Mulder told us: “Cape Town has become completely unaffordable for everyone.”But why is housing in Cape Town getting so expensive, and what can be done about it? The Politically Aweh team set out to investigate.The Movement for rent controlOur host, KG, attended the launch of the Fair Rent Campaign by the Rent Control Group. He said the event felt like the 80s – it was held in a church, there was a sound system, there were placards. Rodriguez concert vibes. The Rent Control Group is a volunteer collective that has set out how fair, targeted rent control could work in Cape Town. Its members don’t dispute the mayor’s supply-and-demand argument; they just think the state has tools it isn’t using. “What doesn’t cost a thing is regulation,” said Adam Narain, one of the group’s members. That means limiting how much rent can go up rather than freezing it, capping how many Airbnbs can operate in the CBD, adopting an affordable housing policy and encouraging the national government to put into effect a rental law it has already passed.Also in attendance: struggle legend Zackie Achmat, who happens to be Narain’s landlord. Asked whether this was his tenant’s way of getting his rent down, Achmat quipped: “Well, if it gets any cheaper, then I have to pay him.”The revolution will be sub-let.‘No chance’ of rent control, says deputy mayor Cape Town Deputy Mayor Eddie Andrews says there’s no chance the city will introduce rent control measures. (Photo: Suné Payne) According to the City of Cape Town, rent control is not going to happen.Mayor Geordin Hill-Lewis has written that it “not only fails, it entrenches inequality”. Deputy Mayor Eddie Andrews was even more succinct when KG asked if there’s a chance of rent control: “No chance. Market goes where market goes, and market stays where it’s enabled.”University of Cape Town urbanist Professor Edgar Pieterse disagreed. “The data internationally is very clear,” he told KG. “If you don’t regulate and intervene in rental markets… the owners of the properties, they will always extract as much rent as possible. So you have to regulate.”Funnily enough, South Africa has had rent control before – during apartheid, for white tenants.Plenty of other places regulate rent. Good’s Brett Herron pointed to Austria, where a large share of people live in regulated or social housing. Germany’s rent brake, which caps rents on new leases in tight housing markets, has been extended until 2029. And in New York, a board voted this year to freeze rents on about 1 million rent-stabilised apartments.There’s a law already on the books. A Rental Housing Act amendment names unfair rent increases as an unfair practice, but it still needs to be put into effect. Until then, the only rule is that the increase must be in your lease. “I could be paying 10K now, I could be paying 20K next year,” one Rent Control Group member explained. “As long as it’s in the lease.”Critics argue badly designed caps can choke supply, which is why most local activists are calling for limits on increases rather than a hard freeze.The Airbnb problemCape Town has more Airbnb properties than Sydney, Berlin or Barcelona, though it attracts fewer tourists. (Photo: Flickr / Domenic Gorin / Infinity Studios) Many people at the Rent Control Group meeting said Airbnb and other short-term rentals are a big part of the problem. Cape Town now has close to 27,000 Airbnb listings – more than Sydney, Berlin or Barcelona, cities with far bigger tourism industries. The maths isn’t complicated: a flat let to tourists by the night earns more than one let to a local by the month.Before the elections, we asked six party representatives about the housing crisis. Other than the DA, every party, from the EFF to the Freedom Front Plus, said short-term rentals are part of the problem.Likewise, the City does not think that foreign buyers are contributing to the housing crisis. Hill-Lewis says they affect only the luxury end of the market, but when Daily Maverick scraped Airbnb’s data to test that claim, it found overseas hosts letting out modest flats. Rise Mzansi’s Songezo Zibi put it bluntly: what’s distorting the market is “the power of the dollar, the pound and the euro”.Victims of their own successSo what does the City say is causing the shortage? Semigration. “Because Cape Town works, you have people coming here in their droves,” Andrews told KG.Ironically, Cape Town is now so expensive that some people are packing up and leaving. “A lot of my friends are moving back to Joburg, back to Durban, back to other parts of South Africa because rent is too high,” Narain said.Capetonians are literally choosing no running water over Phala Phala couch money for Harry Potter’s cupboard under the stairs. That’s where we are.The controversial Tafelberg site. (Photo: Jacques Stander / Gallo Images)In July, the Constitutional Court ruled in the Tafelberg case that the City and the province had failed to provide affordable housing in and around central Cape Town, and ordered both to report back under oath.When a journalist suggested at a mayoral debate that the City was reinforcing spatial apartheid, Hill-Lewis’s response was: “That is propaganda nonsense.” Herron, at the same debate, said the opposite: “The City of Cape Town is practising the perpetuation of apartheid in Cape Town.”One tool that could help is inclusionary housing, which makes developers include affordable units in new buildings. “They do it in London, they do it in New York,” said Pieterse. “This is not rocket science.” Joburg has a policy. Stellenbosch adopted one in 2023 and has already approved more than 900 units. Stellenbosch is run by the DA. Cape Town committed to drafting its own policy in 2018, and it still hasn’t been tabled.The City is doing something about Airbnb, though. Its draft Short-Term Letting Bylaw would mean that properties available for short-term letting for more than half the year would pay commercial rates. The Rent Control Group says that isn’t enough: even after paying more, Narain told us, a host can still stand to receive more than double the amount of income of a long-term let.Watch the full deep dive on Politically Aweh’s YouTube channel. And if none of the above works, there’s always KG’s plan: praying for rent to fall. DMFor more from Politically Aweh, subscribe on YouTube, sign up for the newsletter, visit the website or follow them on Instagram, Facebook, TikTok or X.