Airbnb & VRBO Performance in Traverse City Michigan.

Short-Term Rental Regulations in Traverse City, Michigan for 2024

Types of Short-Term Rentals

• Tourist Homes: Hosted owner-occupied rentals, allowed in residential districts.
• Vacation Home Rentals: Do not need to be owner-occupied, allowed in various commercial and development districts.

Zoning Districts and Caps

• C-1 (Office-Service) and C-2 (Neighborhood Center) Districts: STRs capped at 25% of units in a building, or one unit if there are fewer than four units.
• D-2 (Development) and I (Industrial) Districts: STRs capped at 25% of units in a building.
• C-3 (Community Center), C-4 (Regional Center), D-1 (Development), D-3 (Development), GTC (Grand Traverse Commons), HR (Hotel Resort), and T (Transportation) Districts: No cap on vacation rentals.

Licensing Requirements

• License Application: Required for all vacation home rentals, with an application fee of $200.
• Required Documents:
• Parcel ID Number
• Proof of Liability Insurance ($1 million per occurrence)
• Fire Escape Plan
• Site Plan showing conformance to zoning code.
• Inspections: Onsite inspections required every third year.

Enforcement

• Compliance: City staff seek compliance before issuing tickets for unlicensed rentals.
• Penalties: Operating without a license is a civil infraction with a fine up to $500, which can be reduced in court. Repeat offenders may face additional penalties.

Restrictions in Residential Areas

• Central Neighborhood: Zoned for residential use only, no vacation rentals are allowed, but enforcement is challenging due to unlicensed rentals.

Future Considerations

• Potential Caps: Planning commission considering capping STRs in districts without current restrictions or tightening existing caps.
• Enforcement and Regulations: Discussion on stricter regulations, including enforcement and owner restrictions, to be explored further.

Impact on Housing

• Affordable Housing: Efforts to address the housing crisis by potentially offering density bonuses for developers who include income-restricted units.
• Year-Round Housing: Concerns that STRs are reducing available year-round housing, prompting discussions on regulatory changes.

Top Neighborhoods Generating Airbnb Revenue in Traverse City, Michigan

1. Downtown Traverse City

Downtown Traverse City is a hub for Airbnb revenue due to its prime location, offering easy access to restaurants, breweries, shopping, and the beach. Guests love the convenience of walking to various attractions, including Front Street, Grand Traverse Bay, and local festivals like the Cherry Festival. Properties such as the "Center of Downtown: All-New Luxury Condo" and "Modern Condo Walkable to Downtown w/ Free Parking" are highly rated for their location and amenities.

2. Slabtown

Slabtown, located just a short walk from downtown, is another high-revenue area. This neighborhood is appealing due to its historic charm and proximity to beaches, restaurants, and breweries. The "2nd Street Charmer- Easy Cherry Fest location" is a popular choice, offering a beautifully remodeled turn-of-the-century home with all necessary amenities.

3. Boardman Neighborhood

The Boardman Neighborhood, while part of the commercial zoning area, offers a local living experience close to downtown. Guests appreciate the ability to walk to Traverse Bay, Boardman Lake, and various dining and microbrew spots. The "Whole house downtown, with kid and adult bikes" is a favorite among families and couples due to its well-appointed house and bike-friendly environment.

4. Marina/Restaurant District

This area is highly appealing due to its proximity to Grand Traverse Bay, beaches, the marina, and the TART bike trail. The "Charming Marina/Restaurant District Home" is a top choice, featuring a remodeled kitchen, premium mattresses, and a comfortable west-facing deck.

5. East Bay

The East Bay area, while slightly further from downtown, offers a quiet neighborhood experience with easy access to the TART trail, Traverse City State Park public beach, and the VASA trailhead. Guests like the "Traverse City, MI East Bay" home for its fully enclosed backyard and extra sleeping spaces, making it ideal for families or small groups.

These neighborhoods are highly sought after due to their combination of convenience, amenities, and the unique experiences they offer, making them top generators of Airbnb revenue in Traverse City.

Crafting an Inviting Airbnb in Traverse City: Design and Furnishing Tips

Embrace Local Charm and Natural Beauty

• Incorporate elements that reflect Traverse City's scenic surroundings, such as lake-inspired colors, natural textures, and local artwork to create an authentic experience.

Modern Aesthetics with Rustic Touches

• Blend modern decor with rustic charm, a style commonly seen in Traverse City. Use stylish but comfortable furniture, and incorporate natural elements like wood and stone to maintain a cozy atmosphere.

Prioritize Comfort and Amenities

• Ensure your space is equipped with amenities that enhance guest comfort, such as private pools, hot tubs, gas fireplaces, and cedar saunas. These features are highly sought after and can significantly enhance the guest experience.

Optimize Outdoor Spaces

• Create inviting outdoor areas with features like private patios, gas and wood fire pits, BBQs, and outdoor dining spaces. These areas are perfect for relaxation and social gatherings.

Focus on Cleanliness and Hygiene

• Maintain high standards of cleanliness by using disinfectants on all surfaces, including remotes, light switches, and door handles. This ensures a germ-free environment for your guests.

Incorporate Fitness and Wellness Options

• For fitness-conscious guests, consider adding amenities like exercise rooms, treadmills, or access to nearby fitness trails and recreational activities.

Ensure Practicality and Convenience

• Provide practical amenities such as fully stocked kitchens, laundry facilities, and dedicated workspaces to cater to various guest needs, including families, couples, and business travelers.

Highlight Local Attractions

• Decorate your space with information and maps highlighting local attractions like wineries, breweries, beaches, and parks. This helps guests navigate and enjoy the best of Traverse City.

Maintain a Consistent Theme

• Choose a consistent design theme, such as a beach-house vibe or a cozy cabin style, to create a cohesive and inviting atmosphere throughout the property.

Seasonal Adaptability

• Ensure your space is adaptable to different seasons by providing seasonal amenities and decor. For example, offer winter-specific amenities like snowshoes or a cozy fireplace for colder months.

Local Attractions and Insider Tips for Traverse City, Michigan

Top Attractions

Outdoor Adventures

• Sleeping Bear Dunes National Lakeshore: Explore towering dunes, clear lakes, and lush forests. Hike the Sleeping Bear Heritage Trail, a 22-mile trail suitable for all skill levels.
• Grand Traverse Bay: Enjoy water sports like kayaking, canoeing, stand-up paddle-boarding, and jet skiing. Rent equipment and take guided tours.
• Beaches: Visit various beaches around the region, including dog-friendly beaches and those perfect for a relaxing day by the water.

Cultural and Historical Sites

• Downtown Traverse City: Explore art galleries, historic movie theaters, and the State Theatre. Don’t miss the weekly farmers’ market from May to October.
• Lighthouses: Visit historic lighthouses such as the one at Old Mission Point, and enjoy a picnic lunch on the beach.
• Historical Sites: Tour the Village at Grand Traverse Commons and the Traverse City State Hospital, a former state psychiatric institution.

Festivals and Events

• National Cherry Festival: Celebrate the cherry harvest in July with parades, fireworks, and cherry-themed events.
• Traverse City Film Festival: Attend screenings of independent and foreign films, usually held in July and August.
• Beer Week: Enjoy tours of breweries, samplings, and workshops in November.

Food and Drink

• Wineries: Visit over 50 wineries in the Leelanau Peninsula AVA and Old Mission Peninsula AVA. Take wine tours and enjoy tastings.
• Local Cuisine: Try local specialties like cherry pie and whitefish. Explore the downtown area for fine dining and casual eateries.
• Farmers’ Markets & U-Picks: Visit the weekly farmers’ market and various U-pick farms for fresh produce and local products.

Insider Tips

Scenic Drives and Tours

• Pierce Stocking Scenic Drive: Take a scenic drive through Sleeping Bear Dunes National Lakeshore for stunning views.
• Old Mission Peninsula: Drive up to the lighthouse and enjoy the wineries and beaches along the way.

Water Activities

• Crystal River Kayaking: Go kayaking or tubing down the Crystal River for a unique water experience.
• Rent Watercraft: Rent jet skis or pontoon boats on East Bay for a fun day on the water.

Seasonal Activities

• Fall Color Tours: Enjoy a stunning fall color tour or a winter sleigh ride at Fantail Farm.
• Winter Sports: Engage in skiing, snowboarding, cross-country skiing, snowmobiling, and snowshoeing in the winter.

Hidden Gems

• Glen Arbor: Visit Glen Arbor for lunch or dinner and explore the nearby attractions like the Life Saving Station.
• Petoskey and Charlevoix: Take a day trip to Petoskey and Charlevoix, and search for Petoskey stones along the Lake Michigan shoreline.

By sharing these attractions and insider tips, you can help your guests make the most of their visit to Traverse City, Michigan.

Practical Tips to Run a Successful Short Term Rental Business in Traverse City, Michigan

To ensure the success of a short-term rental business in Traverse City, Michigan, several practical tips can be implemented:

Noise Regulations and Guest Communication

Inform guests about quiet hours and noise regulations to maintain a harmonious environment. Include this information in both digital and physical house manuals to avoid any misunderstandings. This helps in complying with local regulations and ensures a pleasant stay for both guests and neighboring residents.

Comprehensive House Manual

Create a detailed digital and physical house manual that includes essential instructions, Wi-Fi passwords, and other important details. This manual should cover everything from appliance usage to emergency contact numbers, making it easier for guests to navigate the property.

Simplified Check-in Process

Utilize smart locks to streamline the check-in process, eliminating the need for physical key exchanges. Provide guests with a digital keypad code and clear instructions via email before their arrival. Additionally, include parking instructions with photos to help guests locate and use the designated parking areas efficiently.

Additional Considerations

Ensure compliance with local regulations, such as obtaining the necessary short-term rental permits and adhering to zoning restrictions.Maintain the property's cleanliness and well-being, as this is crucial for positive guest experiences and repeat bookings.Consider offering additional services like mid-stay cleaning and grocery delivery to enhance the guest experience and differentiate your property from others.

Here is a brief list of house cleaning, repair, and maintenance providers in Traverse City, Michigan:

House Cleaning Services

Love What I Do Cleaning

• Offers household, commercial, and disinfecting services.
• Services include washing dishes, vacuuming, dusting, mopping, bed making, laundry, and more.
• Also provides organizing and garage cleaning services.

Scrub Club Cleaning Service

• Provides home cleaning, vacation rental cleaning, office cleaning, move-in and move-out cleaning, and post-construction cleaning.
• Serves individuals, builders, property managers, and business owners.
• Covers Traverse City, Williamsburg, Kingsley, Interlochen, and Grawn.

Orchard Cleaning Services

• Specializes in eco-friendly and chemical-free cleaning using Young Living essential oils.
• Offers top-to-bottom cleans, general maintenance cleans, rental make-ready cleans, and commercial cleaning services.
• Serves Grand Traverse County and Leelanau County.

Specialized Cleaning and Maintenance Services

Modernistic

• Provides professional carpet cleaning, air duct cleaning, and tile and grout cleaning.
• Offers services to improve indoor air quality and remove allergens.
• Serves Traverse City and other areas in Northern Michigan.

Traverse City, Michigan: Understanding Short-Term Rental Management Fees

In Traverse City, Michigan, managing a short-term rental property comes with varying fees, typically ranging from 10% to 30% of the rental revenue, depending on the level of service provided. Full-service management companies, such as Awning and Hygge Up North, offer comprehensive services including guest communication, marketing, and maintenance, and these services usually fall on the higher end of the fee spectrum, often between 15% to 25% of the rental income.

In contrast, basic or half-service management, like that offered by Evolve, may charge lower fees starting at around 10%, but these services often leave more of the day-to-day tasks, such as cleaning and guest communication, to the property owner.

Additional fees can also apply for services like cleaning, repairs, or design enhancements, which can further impact the overall cost of managing a short-term rental property in Traverse City. Understanding these fee structures is crucial for property owners to maximize their rental income while ensuring compliance with local regulations and maintaining high standards of guest satisfaction.