Overview: STR Allowance Status

Short-term rentals (STRs) are allowed in Ludington, MI under a city licensing program. The city has a cap on the number of licenses issued (currently 30 under existing regulations, with a proposed increase to 50). The city council has discussed removing a "sunset" clause from the original ordinance, which would make the STR program permanent.

How to Start a Short-Term Rental Business in Ludington

Starting an STR in Ludington involves a structured regulatory process focused on safety, compliance, and neighborhood integration. Key steps include:

1. Property Eligibility: Confirm your property meets city zoning requirements for STR use (details on zoning restrictions were not provided in the sources, but the ordinance governs licensing).
2. License Application: Obtain a city-issued STR license. Application details are available on the city website.
3. Safety Inspection: Successfully pass a city inspection by the Building Inspector to ensure the property meets safety standards. Inspections occur within the broader rental inspection program cycle (see Required Documents section).
4. Compliance: Adhere to all operating conditions stipulated by the license, including spacing requirements from other licensed STRs.
5. Registration: Register your property as a rental unit with the city, as all rental units are subject to city oversight.

Required Documents, Permits, Licenses, and Guidelines

Operating an STR in Ludington requires compliance with several documents and programs:

1. Short-Term Rental License: The primary permit allowing legal operation. Applications are submitted through the Building Department.
2. Rental Registration: All rental units in Ludington must be registered with the Building Department. This registration is separate from the STR license.
3. Inspection & Compliance: Properties are inspected on a 3-year cycle by the City Building Inspector. A Certificate of Compliance must be obtained and maintained.
4. State Use Tax: STRs are considered taxable lodging under Michigan law. Hosts must collect and remit a 6% use tax to the Michigan Department of Treasury for all stays shorter than 30 days.
5. Occupancy Tax: The Summer article incorrectly states a 5% city occupancy tax. The authoritative source (Manistee News Advocate) clarifies that the only statewide tax requirement is the 6% Michigan use tax. Investors should verify directly with the city if any local lodging taxes apply, as this information was not confirmed in the provided sources.
6. Forms: The following fillable forms are required and available on the city website:
   • Short-Term Rental Application
   • Rental Registration
   • Property Questionnaire
   • Rental Disclaimer

Specific Regulations for Short-Term Rentals in Ludington

While the ordinance is evolving, the following regulations apply to STRs in Ludington:

1. License Cap: The city issues a limited number of STR licenses.
   • Current Cap: 30 licenses.
   • Proposed Cap: The city council has considered increasing the cap to 50 licenses.
2. Spacing Requirement: Licensed STRs must be spaced at least 150 feet from each other.
3. Ownership Limitations: The proposed changes include a criterion that the property owner does not have an ownership interest in another short-term rental in the city. Additionally, licenses may only be issued for properties with one or two dwellings, and if there are two dwellings, only one can be licensed as a rental.
4. Application Changes: The application process has been updated to include a description of the property.
5. Program Permanence: The original ordinance contained a "sunset" clause that would have ended the program at the end of the calendar year. The city council is moving to remove this clause, making the STR program permanent.
6. Renewal and Enforcement: The updated ordinance includes formal processes for license renewal, suspension, revocation, and non-renewal.
7. Fee Schedule: The city is considering a new fee schedule for various services, which includes fees for zoning application violations, ordinance violations, inspections, a certificate of occupancy, a sign permit, a permit transfer fee, and late registration of rentals.

Contact Information for Local Authority

The primary authority for STR regulations in Ludington is the Building Department. The key contact is the Building Inspector.

• Building Department
  • Physical Address: 400 S Harrison Street, Ludington, MI 49431
  • Phone: (231) 843-2956
  • Fax: (231) 845-1146
  • Building Inspector: Shaun Reed
    • Email: sreed@ci.ludington.mi.us
• General City Contact:
  • Phone: (231) 845-6237
  • Email: info@ci.ludington.mi.us
  • Hours: Mon-Thurs 7:30am-5pm, Fri 8:00am-noon

Links to Source Pages

• Ludington Daily News: Article on Proposed STR Ordinance Changes
• City of Ludington: Rental Inspection Programs (Licensing & Forms)
• Manistee News Advocate: Article on STR Regulation in Michigan (Context for State-Level Rules)
• Summer (GoSummer): Article on Ludington STR Market (Third-Party Overview)