Traverse City, MI

Scott-and-Rene0
Level 2
Traverse City, MI

Traverse City, MI

Welcome to Traverse City, MI

 

Hopefully this is where we can share a discussion of local interest from around our region.

59 Replies 59
Tom34
Level 2
Traverse City, MI

Hi Scott & Rene, is this the new TC group site? It seems like it's just part of several worldwide conversations instead of a community. Thanks for being so active and responsive to these posts.

Cindi1
Level 1
Traverse City, MI

Hi there Traverse city mi Airbnb community.  I was planning on doing weekly rentals on my house and just found out it is illegal to rent for under thirty days minimum.  Does anyone have any suggestions as to how to get around that as I have a very difficult neighbor that complains about everything.  I have just done a total remodel of my one hundred twenty year old house and was counting on this income to pay for the renovation.  I'm in a bind.

Hi Cyndi,

 

Yes TC and Peninsula Twp where I live both have a 30 day minimum for renting out your entire house.  This is to eliminate short term rentals and the presumed reason is to avoid noisy, obnoxious short terms guests in residential neighborhoods.  Solutions............. if your house is in a commercial zone per zoning ordinance the 30 day rules does not exist.  #2 is to only rent a portion of your house while you also live there.   I believe this is legal which is what we do on the peninsula and we just won a tax tribunal challenge intiated by the Peninsula Twp.     Good luck.   Curt Peterson Old Mission Pen.  Airbnb does not allow posting email addresses or phone numbers.  I wish we could talk. 

L4
Level 2
Traverse City, MI

I have "heard" renting a room is legal in TC as well while you live in the house. Does anyone have factual or clear zoning qotes to define or back this up? I keep reading things over and over but nothing seems very clear. I am so confused and needing info. Thanks for any help!
Curt0
Level 5
Traverse City, MI

Hi Lynn,

 

I live on the Peninsula but zoning ordinances are similar.   The issues are two fold.  Will you be breaking a zoning ordinance which could be punishable by a fine and whether you will lose your PRE (principal residence exemption) which keeps your property taxes low.  If you lose your PRE your taxes will go up by about 100%.   PRE is based on state law, but your local government unit (TC or a township) sets whether you retain 100% or a reduced amount or 0%.   Assuming you do not own any other real estate property you now have a 100% PRE.  So lets start with zoning.  You cannot rent out your entire house for anything less than 30 days in a "residential zone" such as R1.  If your home is in a commercial zone (C class) you can do whatever you like.  You will find this within the zoning ordinance which is available on line.  This limits short term rentals.  Also if you rent you entire home for 15 or more days a year (allowed if in a commercial zone) Michigan statute says the house is a rental and your PRE would be 0%.

 

You can rent out a portion of your house as long as you reside there.  But make sure you are not judged to be a bed and breakfast.  So do not serve food and do not allow your guests to use the kitchen.  There was a case recently in Garfield Twp in which the local tax authority has tried to convince the Michigan Tax Tribunal that the owner of the house was functioning as a B &B.  The case is still under appeal.  If classified as a B &B you would not lose all of your PRE but it would be reduced based on a percentage of how many days you had guests.  So 20 days would have a reduction of 20/365= .05 or 5% so your PRE would be 95%.   But best to not even go there and do nothing that could be construed as a B&B.  Lastly and most important is that the area that you rent out has to be less than 50% of your living area.  Garage and basement area are not counted.  So do not allow guests to use other areas of the house such as kitchen, utility room, living room.   Make sure what you rent out is less than 50% of the living area.  You can find these rules under Michigan law.  Google Michigan law on principal residence exemption and see the guidelines.  

 

Lastly the people I know who have been hassled have had the picture of their house on the Airbnb site so it was easy for the tax authority to identify.  Hope this helps.   

Thank you for testing out penninsula twp for me. Now I just have to hide from condo association. Had several "long lost relatives" visit before my November bathroom fire. Guest used my ceiling light fan which sparked the ceiling fire. I'm back home and prepping to start up again.

What if the agreement to stay is for 30 days, but cancellable at any time?

Curt0
Level 5
Traverse City, MI

Hi Scott, 

 

What I thought for quite some time is now in public record of Peninsula Twp's meeting last week in discussion of the new Bed and Breakfast ordinance re-write:

 

  1. Amendment #190 – Pubic Hearing

Reardon reviewed Amendment 190. Avery said there is a feeling that Airbnb is up against a different set of rules. Will Airbnb be treated exactly the same as this? Reardon said staff has an ongoing list of VRBO, Airbnb and Home Away issues and staff is researching and enforcing. Wendling said this problem is not specific to this Township. Communication is the first step. Wendling explained the legal track to enforcement. Witkop asked what the problem with this Airbnb concept is.  Reardon said the Township has defined uses that are allowed

 

and not allowed. Operating a B&B without prior permit is not allowed. Also Personal Residential Exemption may be assessed differently. Amendment 190 will not change the issue with Airbnb. Amendment 190 deals with how the Township regulates and rules surrounding B&B establishments that have a permit.

 

This is the first public record where I see they are actively going against airbnb.   We survived our tax tribunal issue yesterday and were given back our 100%PRE for the tax years in question.   Justice worked and bullying by Peninsula Twp did not prevail. 

 

Regards,

 

Curt [Surname hidden]

Old Mission Pen. 

Curt0
Level 5
Traverse City, MI

Hi Scott,

 

You still involved?   In TC Airbnb?   Would like to meet with you on what is happening in TC and GTC and our government.  We have won the latest 2 legal issues with loss of pre in GTC. 

 

Curt [Personal Details]

Curt,

 

Yes still involved but do not have an active listing for the time being. Sounds like you have been busy.  

Hi to all TC area hosts.   Here is an update on legal status of Airbnb in Grand Traverse County.  Based on two hearings before the Michigan Tax Tribunal this past June you CAN rent out a portion of your house and retain 100% your PRE (Principal Residence Exemption).   Make sure you are not serving a breakfast (but you can offer items for self serve such  as breakfast items..... just make sure your are not doing any SERVING but just offering).   (So do not cook a breakfast for your guests ).  Also it is beneficial that what area of your house you are offering for Airbnb activity is less than 50% of your living area.  If you offer more than you could lose a portion of your PRE.  We now know that township officials and Grand Traverse County Equilization employees are in contact with each other on Airbnb issues and they are trying to clamp down for whatever stupid ideas they come up with.  In fact national and state planning organizations have podcasts and webinars on how to shut us down and regulate us. 

 

If you are being subjected to any negative action please let us know on this site.  We may be able to help.  We are winning 100% against GT County and Peninsula Township.

Hi Curt:

Reading this thread and wondering if the above mentioned is still in effect?  We are new to Airbnb and living in East Bay Township.  Wanted to offer breakfast, but now reading this feeling that may not be a good option due to tax law.  I also joined Facebook group and asked question there.  Appreciate your time and answering of my question.  Blessings, Marlene

Hi,

East Bay Twp. just passed a short term rental policy ordinance in June.   This allows for some legal rentals after you obtain a permit.   You can find the reg easily online and the approval process seems simple.   Regards,  Curt

Curt,

 

I am subject to negative action. Received a letter from Amy L. DeHaan assessor for Garfield Township. She noted I'm in violation of Zoning Ordinace, Seciton 201 Article 3. She is threating to remove my PRE.  I rent less than 50% of my primary residence and I do not serve any food items of any type. I know I am many Garfield Township homeowners who are operating an Airbnb. I don't want to violate any laws, but believe I should have the right to support my income and contribute taxes to the state of Michigan and promote the tourism in the Traverse City Area. Please reach out to me with any supporting information you can offer, including communtiy support groups.