Real Estate Investor Magazine South Africa August 2016 | Page 45

properties, such as townhouses or apartments, is happening earlier now than previously as home owners look to better security and lower utility costs and convenience.” The aforementioned principles of urbanism are about adding benefit to four stakeholder groups: residents, businesses, developers and municipalities, and the primary mandate that governs this movement into the city is about creating livable and sustainable communities. As such it is of paramount importance that all stakeholders take an active role in the cities in which they live, and don’t only rely solely on their local government to drive this mission. With an increase in density, it is inevitable that there will be additional pressures placed on an urban environment especially when it comes to available space, required resources, and the general economy. The answer to these pressures is in the pooling of these resources - what has become known as the “sharing economy”, or collaborative consumption. This model is most likely to be used when the price of a particular asset is high and the asset is not fully utilised all the time. This is by no means new or innovative; the renting or sharing of facilities or property has always been readily available, but previously would likely require far more effort to coordinate than it was worth. Technology however has made enough data available that it has become easier to match demand with supply, and has simultaneously lessened the cost and effort of transacting, as well as made it more secure with an increase in the efficacy of security checking and safe online payments. These factors combined mean that shared resources have lessened requirements on the city, and residents lives are made more convenient with easier access to supplies with less obligation or commitment. However, when there is a high demand for a product the first thing that is affected is the price of that product, making it less accessible to the general community. That is what is currently happening in cities around the world with property prices skyrocketing, as well as parking prices, office rental costs, and not least of all, the price of property rentals. These factors combined mean that residents are in danger of being forced out of the city as living costs become more than they can afford. Apps such as Airbnb that tap into this insatiable demand are driving this issue, and fast becoming a concern for conscious cities. Some, such as Berlin, have even gone so far as to ban residents from renting out their houses this way, instead allowing them to rent out individual rooms only, or face a significant fine. This recently implemented German law – Zweckentfremdungsverbot – has been described by Andreas Geisel, Berlin’s head of urban development, www.reimag.co.za as “a necessary and sensible instrument against the housing shortage in Berlin…”. The reasons for this are many: short-term or overnight rentals are not only driving the price of rental property through the roof, making it unaffordable for most longterm residents, but they are also dramatically affecting hotels and the tourism industry, with hotel occupancy suffering dramatically in many tourism-driven cities. Both of these in direct contrast with the previously mentioned principles of urbanism - benefits to business and to the community. “As an urban property developer, and thus a roleplayer in the changing landscape of the City of Cape Town, I regularly remind people of the symbiotic nature of the relationship between a city and its residents. As much as the city is obligated to service its residents in order to improve and facilitate their daily lives, so are the residents an integral part of the city’s success. Short-term rentals, while bringing people into the city from other parts of the world, can also detract from a permanent community and as such the opportunity for this symbiotic relationship that is required to run a successful and happy urban environment,” says Jacques van Embden, MD of Blok, urban property developers in the Western Cape. Therefore, while bringing short-term visitors to our city has obvious benefits in terms of tourism and awareness, we must always be cognisant of not allowing this to impact on our longer-term visitors and residents; those that call Cape Town home, and take care of it as such. RESOURCES JDA AUGUST 2016 SA Real Estate Investor 43