Renting By The Week in Traverse City: Make It Legal?

John Smith decided he’d test the waters by renting out his home for a week in July and another week in August.

“I’m not in town during the summer months and my house is sitting empty, and I’m uncomfortable with that that as a homeowner,” says Smith, who requested his real name not be used.

Smith and who-knows-how-many others rent out their downtown homes weekly despite a city ban of renting out residentially zoned homes for less than 30 consecutive days.

Some believe--or hope--the new make-up of the Traverse City Commission might be open to making the law more flexible.

“I’m paying taxes and I should have some leeway to do what I choose to do with my own property,” Smith says, arguing it’s within the spirit of the law to rent out his house one week out of every 30 days.

The issue created a firestorm six years ago after some residents bought homes for the sole purpose of renting out to vacationers.
Liz Whelen, president of the Boardman Neighborhood Association, says she and others resented loud, late-night parties. “That’s not why we live here,” she says, adding that’s her personal view.

It was a very hot issue, says Ross Richardson, who listened to complaints at packed meetings some six years ago as a planning commissioner.

“The whole danger of vacation rentals is that you basically could turn the residential neighborhoods into hotel districts. They’re on vacation for a week, so they may party until two in the morning. Saturday comes, they leave, and someone new comes in.”

On the other hand, Traverse City tax bills are high, and lucrative rentals could help cover them. Four Traverse City weekly rentals listed online are charging from $153 to $350 a night -- up to $4,400 for just two weeks.

Zoning Administrator David Weston says he receives about five calls weekly from people asking about the vacation rental policy. He discovered four or five violators earlier this spring after getting neighborly tip-offs. City staffers track down suspects on vacation home websites and sometimes watch a home, looking for out-of-state license plates or other clues of a vacation stay.

“It can take a lot of time,” he says.

Weston initially sends letters ordering the homeowner to cancel the reservation; fines begin at $50 plus court costs each day the home is occupied up to $500 per day plus court costs.

But Mayor Mike Estes says the city isn’t actively seeking violators. “The only time we respond is when we get complaints from neighborhoods: ‘Do you know what my neighbor is doing?’ That’s the only time I’ve ever heard of enforcement.”

Traverse City commissioners weighed in with The Ticker on the issue:

Barbara Budros says she would do whatever the community wants. “The bottom line is people are already renting out their rooms and houses all over town.”

Gary Howe says he’d be open if someone brings it before the commission. “We live in a tourist place, and it’s a way to help people afford their homes. I’d consider looking at it; maybe there are creative ways to allow it that wouldn’t tax the neighborhood.”

Ross Richardson says he could see a reasonable policy that allows rentals “under very limited circumstances, maybe two weeks a year. I just don’t know how you could that without opening the door to something else.”

Mayor Michael Estes says he’d “be open to anything, but there’s been no call from the public at large to revisit the issue. I’m not going to bring it up.”

Jim Carruthers says he’d like to look at the issue again. Vacation rentals provide alternative housing and help folks afford their city homes.

Jeanine Easterday says she’s always open to looking at what people want them to do, but feels like it “wouldn’t or shouldn’t go anywhere. We are so barraged now; people are so over the noise! We already share our streets, share our beaches, share our restaurants. I really think the neighborhoods want the neighborhoods to themselves.”

Tim Werner says, “I wouldn’t say absolutely ‘no’ if what we’re saying is, it’s (allowable) a quarter of the time during the popular visitor season. That kind of limitation would avoid people buying a property strictly to rent out. On the other hand, what we’re after in this community is to have neighbors and faces we know.”