Wanting to open a lodge or guesthouse?
PUBLISHED 7 JAN 2020
Wanting to open a lodge or guesthouse? - written by Rob Severin
As leading estate agents in Hoedspruit, Century 21 Wildlife Properties get many requests from clients wanting to purchase homes in Hoedspruit and either rent them out (like on Air BnB), or open a guest house or lodge. However, it’s not as simple as just finding a physical property or piece of ground. There are other factors that govern this, in particular, zoning which is affected by the home owners rules, reserve rules or the municipal regulations.
A commercial property, is any property from which you derive income from by means of guests staying there. The guests are paying to stay there, these could be holiday makers, safari goers, researchers, student programs, etc. There is a financial benefit for the owner of the property as people utilise or stay at the property. A property zoned as residential can thus not trade as a commercial property or business.
Special consent is needed for an owner of a property to operate as a commercial lodge. The consent needed usually comes from two fronts. The first is the local municipality. In our case, this is the Maruleng Municipality. The second is the particular reserve or estate that the property falls within.
Many estates in the area do not allow properties to be rented for less than 30 days. These include places like Raptors View Wildlife Estate, Lissataba Nature Reserve, Moditlo Wildlife Estate, Canyon Game Reserve and Blyde Botanical Nature Reserve to name a few. This is governed by the home owners rules and the Memorandum of Incorporation which is embedded in the title deeds, making owners accountable to these authorities. Breaking these rules can lead to fines. The benefits to this are increased security and more exclusivity.
Hoedspruit Wildlife Estate was launched and sold with the ability to rent out on a nightly basis. This has boosted investment and provided owners with the opportunity of making income when they are not there. Zandspruit Bush and Aero Estate allow limited rentals that can be on a shorter-term basis, but is also capped to 12 occasions per annum. On the 21 hectare properties in private game reserves they allowed commercial properties but this is already capped and licences are issued. These properties naturally sell for a premium.
Currently the demand for commercial and rentable accommodation exceeds supply, but there is also a mismatch between the asking prices and what buyers are hoping to pay. AirBnB is receiving criticism from several fronts globally. One specific concern is that municipal by-laws are not being adhered to. The Maruleng Municipality uses the following definitions for commercial properties and in order to be operating commercially your property should have consent to be any one of the following:
“BED-AND-BREAKFAST ACCOMODATION” – A commercial accommodation
establishment of up to and including four (4) guest rooms. The main function is
to provide temporary accommodation under personal supervision of the owner and
his/her family from his/her dwelling house. Meals (usually breakfast) are provided
to paying guests only. Only one (1) kitchen per establishment is allowed. A bathroom
for each guest room may be provided, but a bathroom may also be shared with the
“GUEST HOUSE” – A commercial accommodation establishment of five
(5) up to and including sixteen (16) guest rooms. No permanent
residents (except for the manager) are allowed. The main function is to
provide temporary accommodation under personal supervision. If meals
are provided, it should be served to paying guest only. Only one (1)
kitchen per establishment is allowed. Each guest room must have it’s
own en-suite bathroom. All other facilities such as a bar and swimming
pool are for paying guests only.
”RESORT” – Means a place frequented by people for relaxation or
recreation - for a specified purpose or quality (i.e. health, holiday,
mountain resort). Specialised resorts (i.e. youth camps, church,
cultural). Picnic resorts, holiday towns and hotels/motels, rest camps,
camping. [Nature, water, historically (i.e. mining towns, trading posts,
trek routes, old bridges) orientated].
“TOURISM” – Means the business of providing services to tourists; the
practice of travelling for pleasure; organised touring; accommodation
and entertainment of tourists as an industry.
The municipality can consent to allow properties to be commercial, however this must be applied for. They will however consult with the neighbours and Game Reserves and Estates first. Thus, often it is actually the Reserve and its internal policies that dictate which properties can be commercial and how many commercial beds they may have. From that point of view, it’s not easy to purchase any property and convert it to be a commercial property. Another factor to consider it that commercially zoned properties pay higher municipal rates and taxes. So, if it’s a residential property you probably don’t want to be sitting with commercial zoning.
Professional Estate Agents specialising in the area should be able to assist you in selecting the correct property for your requirements. But be aware, it’s your responsibility to make sure you purchase the correct property, otherwise you may not be able to do what you intended.
For more information on commercial policies and zoning, contact Century 21 Wildlife Properties:
015 793 1534