Detroit, MI – Rental Regulations FAQ 2025

Written by: Sanjin Hadziomerovic

Comprehensive FAQs for Short-Term Rental (STR) Regulations in Detroit, MI

Investing in short-term rental (STR) properties requires an in-depth understanding of local regulations. Below is a comprehensive list of frequently asked questions (FAQs) for STR operators and investors to help you navigate the rules in Detroit and stay compliant while maximizing profitability.

---

1. What is considered a short-term rental in Detroit?

In Detroit, a short-term rental (STR) is defined as the rental of a dwelling unit or a portion thereof for lodging or accommodation purposes for a period of 90 consecutive days or fewer. The city’s regulations categorize STR licenses into four classes based on the duration and nature of the rental (Classes A, B, C or D)*.

Detailed information is available in the Detroit Rental Property Ordinance and Summary of New Rental Ordinance passed in December 2024.

2. Do I need a permit to operate a short-term rental in Detroit?

*Yes, operating an STR in Detroit requires a valid Short-Term Rental License (Classes A, B, C or D). These licenses are specific to the property and applicant, and are categorized as follows:

• Class A: 14-day license. Fee: $100. This license is issued annually, but only one license is permitted per applicant per calendar year
• Class B: 90-day license. Fee: $250. This license is issued annually, but only one license is permitted per applicant per calendar year 
• Class C: Annual license for owner-occupied rentals (for properties where the owner resides on-site). Fee: $500. 
• Class D: Annual license for non-owner-occupied rentals (for properties restricted to Greater Downtown where the owner does not reside on-site). Fee: $750

You can apply for these licenses through the City of Detroit’s eLAPS system: Detroit eLAPS System. For detailed written instructions on how to register click here, or access the video guide How to Submit a Rental Registration Application in Detroit.

3. What are the zoning laws for STRs in Detroit?

STRs are prohibited as a home occupation in residential zones unless explicitly permitted by the ordinance. Use the Detroit Rental Map to verify zoning for your property.

4. Are there occupancy limits for short-term rentals in Detroit?

Occupancy limits are determined by building codes, which dictate the maximum number of occupants per bedroom and dwelling. The Detroit Rental Property Ordinance requires hosts to declare the maximum number of guests in their license application.

5. What taxes are short-term rental hosts required to pay?

As a Detroit STR host, you must pay Michigan Use Tax (6%) on rentals of 30 days or less, property taxes*, and submit a tax compliance affidavit during your license application. The Use Tax must be collected from guests and remitted to the Michigan Department of Treasury.

*In Detroit, property taxes are calculated based on the taxable value of the property, which is typically 50% of the assessed value. The total property tax rate in Detroit varies by location but averages approximately 67.6 mills (6.76%) of the taxable value annually. This means you pay about 3.38% of the assessed value in property taxes each year.

The property taxes are assessed and billed twice annually—summer taxes (due in full by August 15 or split into two payments) and winter taxes (due by January 15). Payments can be made online, by mail, at DivDat kiosks, or in person at the Coleman A.

For details, visit the Detroit Treasury Division or call 313-224-3560.

6. What are the safety and health requirements for STR properties in Detroit?

STR properties in Detroit must comply with building and property maintenance codes, including functional smoke and carbon monoxide detectors, fire extinguishers on every floor, and lead safety requirements for properties built before 1978. Regular inspections are required for license application and renewal. For details, see the Detroit Ordinance or Landlord Guide.

7. How are noise and nuisance complaints handled in Detroit?

Complaints can be submitted via Detroit’s “Improve Detroit” app or directly to city departments. The ordinance requires a 24/7 complaint hotline, with a local contact person mandated to respond within 45 minutes.

8. Can I manage multiple short-term rental properties in Detroit?

Class A and B licenses are limited to one property per applicant per year. Class D licenses allow management of multiple properties but are restricted to the Greater Downtown area. Since it requires the owner to reside in the property, managing multiple Class C properties is not possible.

9. What are the penalties for non-compliance with STR regulations in Detroit?

Penalties include increased fines for violations, revocation of STR licenses for repeated non-compliance, and removal of non-compliant properties from the city’s STR license registry.

All fines are outlined in “Sec. 8-15-11. – Civil fines for violations of article” in the Detroit Rental Property Ordinance.

10. Are there any updates or changes to Detroit’s STR regulations I should be aware of?

Yes, the Detroit City Council passed amendments to the rental ordinance on December 6, 2024, focusing on rental compliance, lead inspections, and tenant protections. These changes have taken effect on January 1, 2025, with full implementation expected by spring 2025.

Detailed information is available in the Detroit Rental Property Ordinance and Summary of New Rental Ordinance passed in December 2024.

11. Can I self-manage my short-term rental, or do I need a property management company in Detroit?

You can self-manage your STR in Detroit, but the ordinance requires a local contact person to be available 24/7 for issue resolution.

12. What are the insurance requirements for short-term rentals in Detroit?

All short-term rental (STR) operators in Detroit are required to provide proof of liability insurance coverage as part of the licensing process. This insurance must adequately cover potential risks associated with operating an STR, ensuring protection for both hosts and guests

13. Are there any local rules regarding hosting platforms (e.g., Airbnb, Vrbo) in Detroit?

Hosting platforms must register with the City of Detroit and comply with specific reporting obligations. This includes providing the city with information about listings and ensuring that all short-term rental properties using their platforms are properly licensed.

14. What are the inspection requirements for STRs in Detroit?

The City of Detroit requires the registration and inspection of all rental properties. The Buildings, Safety Engineering, & Environmental Department (BSEED) is responsible for making sure that all rental properties in the City are properly registered, code compliant, and have obtained a Certificate of Compliance. Inspections include:

• Pre-license inspections to verify compliance with building codes, including plumbing, electrical, mechanical, and property maintenance standards.
• Safety checks to ensure the presence and functionality of mandatory devices, such as smoke alarms in each bedroom, carbon monoxide detectors in single-family dwellings, and fire extinguishers on each floor.

These inspections are conducted by the Department prior to the issuance or renewal of an STR license. Additionally, hosts must submit an affidavit certifying the installation and quarterly inspection of these safety devices.

15. Are there any neighborhood-specific restrictions for STRs in Detroit?

Class D licenses are restricted to the Greater Downtown area, while other licenses must comply with zoning restrictions detailed on the Detroit Rental Map.

16. Is there a cap on the number of STR permits issued in Detroit?

Class A and B licenses are limited to one property per applicant annually. There is no city-wide cap beyond these limits.

17. What parking requirements exist for STRs in Detroit?

The ordinance mandates parking availability to be declared during license application, ensuring sufficient off-street parking where applicable.