Thinking about hosting guests for big game weekends or summer visits in Ann Arbor? Before you list your place, you need the right license in place. The city has clear rules on who can operate a short‑term rental, where it’s allowed, and how to apply. In this guide, you’ll learn the license types, zoning limits, costs, timelines, and a step‑by‑step path to approval so you can launch with confidence. Let’s dive in.
Know the three STR types
Ann Arbor licenses three types of short‑term rentals defined in the city ordinance:
- Non‑Principal Residence STR - an investment or commercial STR at a property that is not your principal residence.
- Principal Residence Homestay - you live there as your principal residence and are present during guest stays.
- Principal Residence Whole House - your principal residence, but you are not present during guest stays.
You must have a city STR license to operate any of the above types. The ordinance also requires that every listing displays your license number and maximum occupancy. You can read the full rule set in the city’s Short‑Term Rental ordinance, Chapter 97 in Ordinance ORD‑20‑24.
Where STRs are allowed
Location matters. Ann Arbor ties STR permissions to zoning:
- Non‑Principal Residence STRs are allowed only in Mixed‑Use zoning districts, unless a property qualifies as a pre‑existing legal nonconforming use under later amendments.
- Principal Residence STRs - both homestay and whole‑house - may be licensed in Residential and Mixed‑Use zones.
- Accessory Dwelling Units (ADUs) cannot be used as STRs.
If you think a property may qualify as a legal nonconforming non‑principal STR, review the 2021 Unified Development Code amendments and staff materials in ORD‑21‑12 / ORD‑21‑13, and start with the City’s Short‑Term Rentals page for current guidance.
Step‑by‑step: apply for your license
1) Confirm zoning and eligibility
- Verify your address zoning to see which STR types are allowed there.
- For non‑principal STRs, confirm the Mixed‑Use zoning requirement or whether the property is recognized as a legal nonconforming STR in city records.
- Only the property owner or permanent resident may apply. Licenses are not transferable.
2) Gather info and documents
Have these ready before you start your online application:
- Property address and dwelling type.
- STR type you will operate.
- Number of bedrooms available to rent and the maximum permitted occupancy under the Unified Development Code.
- Names, phone numbers, and emails for two local contacts responsible for the unit. For principal‑residence STRs, at least one contact must be a permanent resident.
- For principal‑residence STRs, a sworn statement that the home is your principal residence.
- If non‑owner‑occupied and eligible, your current Certificate of Compliance from Rental Housing Services.
City forms, fees, and the application link are available on the Short‑Term Rentals page. For inspection and rental compliance information, visit Rental Housing Services.
3) Apply online in STREAM and pay the fee
- Submit your application and payment through the City’s STREAM portal from the STR page.
- The fee is $500 per unit per year and is due at submission. The City notes fees are non‑refundable if an application is denied.
4) After you apply
- City review can take up to 21 business days once you submit and pay.
- If approved, post the license at the property and add the license number and occupancy to all listings.
- Renew annually. Principal‑residence STRs require a renewed sworn statement within 30 days of the license anniversary.
5) Inspections and Certificates of Compliance
- Principal‑residence homestay and whole‑house STRs are not subject to a City STR inspection as part of licensing.
- Non‑owner‑occupied STRs must comply with the Housing Code and hold a valid Certificate of Compliance before applying for the STR license in zones where they are allowed.
Full requirements and definitions are in Chapter 97, Short‑Term Rentals.
Rules to follow after approval
- Include your license number and maximum occupancy in every online or print advertisement.
- Follow occupancy limits set by the Unified Development Code.
- Keep your two local contact persons current.
- Do not transfer the license if the property changes ownership - a new owner must apply.
Violations are civil infractions with fines up to $500 per day plus costs, and the City may suspend or revoke a license for violations or misrepresentations. See enforcement details in ORD‑20‑24.
Taxes and insurance basics
- Michigan applies a 6% use or sales tax to lodging rented for 30 days or less. Learn how to register and remit on the Michigan Department of Treasury’s Use Tax guidance.
- Some Michigan communities collect additional local lodging or accommodations taxes. Confirm any current Washtenaw County or City Treasury requirements before you host.
- The ordinance does not mandate a specific insurance policy. It is wise to confirm with your insurer that your coverage includes short‑term rental activity.
Common pitfalls to avoid
- Listing or hosting without a valid STR license.
- Missing the license number or occupancy in your online listing.
- Trying to operate a non‑principal STR in a residential zone.
- Applying for a non‑owner‑occupied STR without a current Certificate of Compliance.
When in doubt, start with the City’s Short‑Term Rentals page and consult the UDC amendments for zoning nuances.
Quick checklist
- Confirm zoning and STR type allowed at your address.
- Gather contacts, bedroom count, and occupancy details.
- If required, obtain a Certificate of Compliance.
- Complete the STREAM application and pay the $500 fee.
- Post your license and add the license number and occupancy to all ads.
- Set reminders to renew annually and update your sworn statement if applicable.
Ready to map out your Ann Arbor STR strategy? Whether you are licensing your principal residence or exploring an investment in a Mixed‑Use zone, you deserve clear guidance and a smart plan. If you want help evaluating zoning, projected returns, or your next purchase or sale, connect with Anthony Maisano for tailored advice.
FAQs
Who can apply for a short‑term rental license in Ann Arbor?
- Only the property owner or the permanent resident may apply, and licenses are not transferable.
How long does approval take for an Ann Arbor STR license?
- City review can take up to 21 business days after you submit and pay, not including any needed inspections.
Can I run a non‑principal STR in a residential zone in Ann Arbor?
- No, non‑principal STRs are limited to Mixed‑Use zones unless a property qualifies as a legal nonconforming use under 2021 amendments.
Do I need an inspection for a principal‑residence STR in Ann Arbor?
- Principal‑residence homestay and whole‑house STRs do not require a City STR inspection as part of licensing.
What happens to my STR license if I sell my Ann Arbor property?
- The license does not transfer to a new owner, so the buyer must apply for a new license if eligible.
