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I just touched down in Cape Town and thrilled to be back in the Mother City 🇿🇦

Cape Town has the most stunning attractions and views in the world - turning it into a huge tourist hotspot.

But there’s another side to Cape Town’s attraction, and a tech company (Airbnb) is in the middle of it.

Today we’re diving into Cape Town’s Airbnb dilemma. Let’s go!

In November 2019, the first case of COVID-19 was reported in Wuhan, China.

What followed was panic and lockdowns, as governments raced to keep people apart.

Boardrooms turned into Zoom calls, and we swapped out office cubicles for any spot with a decent table and Wi-Fi.

A year later, life started going back to normal. But remote work didn’t disappear.

People started making the world their office.

And digital nomadism - a lifestyle where you travel as you work - went mainstream.

Today, around 63 million people are living the digital nomad life, hitting up tourist cities to stay for a while.

And in Africa, one city is pulling them all in.

Welcome to the Mother City

In 2024, Cape Town is the second-best city in the world to visit—just behind New York.

And there are a ton of reasons to visit Cape Town.

You can hike up Table Mountain, visit Robben Island (where Nelson Mandela was once held), surf in the ocean, or enjoy the nightlife if you’re into the social scene.

But for digital nomads, Cape Town has something else that makes it special:

The cost of living.

With South Africa’s weaker currency, the rand, everything here is more affordable if you’re earning in dollars or euros.

For instance—living in London is roughly 3.6 times pricier than Cape Town.

So if you’d need £6,800 a month to live comfortably in London, you could enjoy a similar lifestyle in Cape Town for about £1,888 ( paying for a one-bedroom apartment, transport, and eating out).

Since the borders reopened in 2021, tourists have been pouring into Cape Town.

It’s a big win for tourism, which makes up 8.7% of South Africa’s economy and employs 1.46 million people.

But here’s the catch. A lot of them are not leaving.

And there’s a less shiny side to this influx.

The housing market is struggling to keep up

San Francisco has around 7,888 Airbnb listings.

Berlin's got 13,759, Sydney has 15,548, and Barcelona comes in at 18,925.

Cape Town?

It knocks them all out with 23,564 listings – the highest in the world.

As more nomads with dollars to spend settle in, the demand for short-term rentals has rocketed.

Since they can pay more, property owners are turning to Airbnb instead of long-term leases.

So what’s happening now?

More people are hunting for places than are available, pushing rental prices up and making it tougher for locals to afford.

Asking rents for two-bedroom apartments in Cape Town's CBD shot up nearly 40% last year, now averaging around $1,378.

That’s a big jump from $989 in 2021.

And it’s worse if you dream of owning one.

“For people in their 20s, buying property is nearly impossible—unless you earn a lot of foreign currency or have family money.” says Chris, who’s lived in Cape Town since 2018.

And things could get even trickier.

Introducing the Digital Nomad Visa (DNV)

In June 2020, Estonia launched the world’s first digital nomad visa.

Unlike a tourist visa, it allowed visitors to work remotely in Estonia for up to a year.

Since then, over 60 countries, including South Africa, have jumped on board.

South Africa introduced its own DNV in April this year, letting remote workers live and work in the country for up to three years.

And all you need to qualify is:

• You need a job that pays at least $36,000 a year

• You must be officially employed by a company (sorry freelancers)

• And if you stay longer than six months, you have to pay income tax

The average South African salary is around $1,406 (R24,813) a month, which can’t really compete with digital nomads earning $36,000 a year.

Why is this an issue?

Businesses are starting to adjust to nomads’ spending power, and everything—uber rides, dining, nightlife—is getting pricier.

So, here’s the big question: what if Cape Town saw thousands more nomads moving in?

Barcelona would know

Barcelona pulls in over 15.6 million tourists a year, bringing in about 15% of the city’s income.

But for locals, it’s starting to feel like they’re playing second fiddle to tourists.

The beaches are too packed.

Neighborhoods feel more like photo ops than places to live.

And local markets that used to sell fresh produce, fish, and meat now cater to tourists, selling smoothies, chips, and quick bites instead.

Just off the coast, in the Balearic Islands, rents have nearly tripled in a decade, making things even tougher.

Fed up, about 3,000 locals took to the streets in July, spraying tourists with water and chanting, “Tourists go home!”

The protests put a stop to new short-term rentals.

And after handing out 7,368 digital nomad visas since last January, Spain also added extra rules to make it tougher for nomads to settle in.

This isn’t just happening in Barcelona.

Cities like Lisbon, Florence, Amsterdam, and the Canary Islands have also seen housing costs spike, pushing them to ban new Airbnb listings.

South Africa is taking some steps—government discussions are in the works to cap Airbnb listings and stay durations.

It's a good start.

But is it enough? And where do you see Cape Town’s housing crunch heading?

Let us know here

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