Short-Term Rentals—What Your Peers Are Saying
The explosion of short-term rental platforms like Vrbo and Airbnb has revolutionized the Michigan vacation real estate market. Yet, for property owners—and lawyers like you who advise them—the line between guest and tenant may be perilously thin.
A recent conversation in your online ICLE Community highlights not only the evolving state of the law but also the tough, practical questions practitioners face. This summary of the thread shows what your peers are saying you need to know when a client asks, How do I get rid of a guest who doesn’t leave?
Distinguishing Between a License and a Tenancy Is Critical
Whether a guest renting a property (even for 30 days) is considered a licensee or a tenant is determined by a totality-of-the-circumstances test.
The fundamental issue is whether there was a transfer of exclusive possession and control—a true tenancy triggers landlord-tenant law, while a mere license may allow for quicker removal under different statutes (e.g., the Innkeeper’s Act).
Once a Tenancy Exists, Summary Proceedings (Eviction) Are Required
If the arrangement is found to be a tenancy, particularly for stays of 30 days or more, traditional eviction procedures in Michigan must be followed.
While fixed-term leases do not require a 30-day notice for expiration, most rental agreements contain month-to-month holdover terms. Drafting clear fixed-term contracts (with explicit holdover rent increases and no automatic renewal) may help clarify parties' intentions and obligations.
For-cause terminations may sometimes use shorter notice periods per MCL 554.134(1), but this is more practical for longer-term stays.
Contract Language and Platform Terms Matter—But May Be Overridden
Vrbo, Airbnb, and similar platforms often attempt to establish rental relationships as licenses rather than leases. However, Michigan courts will look past this language to the substance of the arrangement—exclusive possession generally creates a tenancy, regardless of what the agreement says.
Even license agreements for entire houses may be found to have created a tenancy, particularly if the owner does not retain significant rights of access or control.
Self-Help Eviction Is Illegal for Tenancies and May Result in Severe Penalties
In Michigan, self-help (e.g., locking guests out or removing belongings without a court order) for tenants is strictly prohibited and may result in treble (triple) damages under Michigan law.
Lawyers should inform clients not to attempt self-help remedies and instead use lawful summary proceedings. Attempts at self-help, regardless of how tempting, pose significant legal risks.
Practical Drafting and Management Tips for Short-Term Rentals
To avoid tenancy issues:
• Consider limiting rental periods to under 30 days and emphasize the licensee status, retaining some rights of access and control
• Use clear written agreements, specify the nature of the occupancy, and include provisions like substantial daily holdover charges and explicit move-out times
• For longer stays (beyond 28 or 30 days), prepare to use formal eviction procedures and consider strategies like cash for keys for voluntary move-outs if litigation would be time-consuming or costly
Final Thoughts
Your peers are generally cautioning against overreliance on contract language alone to circumvent landlord-tenant protections. Local law and judicial interpretation will control, and courts prioritize substance over form regarding occupancy rights.
Want More? Engage with 6,000 Other Partners