MUSKEGON, MI – After six months of not accepting new short-term rental applications in the city, Muskegon officials are considering maintaining the status quo for another month.
The Muskegon City Commission is scheduled to vote on the changes during its meeting on Tuesday, August 27.
If all points are approved by the council, it will mean that the overcrowded areas will slowly begin to work to reduce short-term rentals in the area as properties are sold and licenses expire.
A six-month moratorium on new short-term rentals in the city of Muskegon expires on September 8.
City staff are recommending that the City Council extend the moratorium for another 30 days, through Oct. 8. They also plan to recommend the creation of an overlay district that would limit the number of short-term rentals in an area based on the total number of apartments in that area.
“It’s about getting the numbers down,” said Commissioner and Vice Mayor Rebecca St. Clair during a work session on Aug. 12. “The reason we’re having this conversation in the first place is because people in the (Beachwood/Bluffton) area are having issues with the short-term rental situation in their community.”
The impact of the short-term rental housing market on residential neighborhoods, particularly near the lake, and on the long-term rental housing stock has raised concerns among some residents and city officials.
Reasons cited for the suspension included concerns about a declining number of long-term residents, a reduced supply of long-term housing and a corresponding increase in prices for these, as well as an increase in noise and traffic during the summer season.
The moratorium began in March and gave the city an opportunity to pause and analyze the situation.
During a work session last week, City Manager Jonathan Seyferth said he would recommend to the council the creation of an overlay district that would limit the number of short-term rental units in each zone to 4% of the housing stock. The city is divided into 11 different zones based on U.S. census tracts.
Seyferth explained that this figure is due to studies that have shown that when the number of apartments sold increases above 5% of the housing stock, it has a negative impact on residential areas.
Staff also plan to recommend:
- No property (except commercial properties) may have more than two short-term rental buildings adjacent to it.
- The city maintains that short-term rental licenses are non-transferable.
- The city allows a 30-day grace period for renewing short-term rental applications after the deadline, subject to a fine. Existing rental properties in restricted zones can still be re-registered as long as they are still owned by the same owner.
During last week’s work session, Commissioner Jay Kilgo, who owns a short-term rental property and hopes to one day pass it on to his son, said the licenses should be transferable.
“I want us to consider the possibility of transferring if they already have a valid property,” Kilgo said. “I know there will be some cases where the best use of that property is to maybe transfer it to the family and use it in the same way it was used. I just want us to think about that.”
Mayor Ken Johnson said he was intrigued by the prospect and was considering transferring the license to an “immediate family member.”
To give more people a chance, the idea of a lottery system to approve applications was mooted, as well as allowing unlimited short-term rentals in business/shopping districts.
There are a total of 232 registered short-term rental units in Muskegon, spread across 190 different buildings, as some buildings contain multiple units.
The neighborhoods with the most short-term rentals are currently Beachwood-Bluffton with a total of 76 and Lakeside/West Glenside with 81.
Seyferth said the majority of complaint calls come from the Beachwood-Bluffton neighborhood and include complaints about noise, parking, parties and trash.
The beach district has a total of 861 residential units, so the number of short-term rentals accounts for about 9% of the number of apartments.
In March, the Commission adopted new measures against landlords who violate short-term rental rules.
If a homeowner is not registered, he or she will receive a letter. After 14 days, the fine process begins, with the fees increasing more rapidly.
“This process used to be much more lengthy and now the fees are rising much more,” said Seyferth.
For civil violations, the “three violations and you’re out” rule also applies, with fines increasing with each violation before registration is eventually revoked after three violations in a calendar year.
Seyferth said there have been no violations since faster enforcement began.
These restrictions on short-term rentals do not apply to rentals by owners, that is, when the owner rents out a room in his or her home where he or she currently lives.
Want more news from the Muskegon area? Bookmark the local Muskegon News Page or sign up for the free “3@3 Muskegon“ daily newsletter.
