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Michigan Laws to Know Before Investing In Rental Real Estate

Landlord-Tenant Law Book on a Desk with a GavelWhen most newbie Michigan investors look into having a single-family rental property, what regularly comes to mind are the operational aspects of the investment: finding tenants, managing property maintenance, and collecting rent. What you may not ponder on is that there are additionally an overwhelmingly wide variety of laws and legal matters that relate to buying and leasing rental homes.

Though different federal laws will affect rental properties nationwide, several of the laws that you must understand are those on the books of your state, county, or even city. Therefore, it is vital to do your research and get a clear knowledge of these laws before you shop for an investment property.

Real Estate Agency and Licensing Law

One of the very important people on your investing team is your real estate agent. The laws that govern the relationship between an agent and their clients differ from state to state. As an investor, it’s essential to perceive what your real estate agent can and cannot legally do, from disclosures to acting in a dual agency capacity.

In particular, recognize that real estate agents may or may not be familiar with property management laws. You should equally have a sound knowledge of the procedures required by Michigan for possessing and keeping a real estate license and find out to ensure that your agent’s license is current and in good standing.

Transfers of Ownership

Another state-specific set of laws you should take into account is those encountering voluntary and involuntary ownership transfers. Voluntary transfers of ownership are those that occur when a rental property is bought out. Having said that, there are some differences among state laws related to who will handle the transfer (your real estate agent or an attorney, for example), whether title insurance is required, who pays which closing costs, and who owns the property on the day of closing.

Though, on the other hand, you should also learn your state laws about involuntary ownership transfers. These transfers, in general, unfold when the heirs of a deceased property owner inherit the property. Perceiving these laws can help you arrange for and easily make the process simpler whether you inherit property or leave your property to someone else.

Limitations on Use

In a vast number of states, local regulations will decide how a property owner may make use of their property. Zoning ordinances, deed restrictions, historic preservation programs, and environmental review laws can all limit how a property owner may find a use for their land or structures.

As an investor, it’s imperative to really know about any local ordinances that may meddle with your intention to renovate or lease the property you aspire to buy. You should equally ensure if any occupancy laws impacted your plans to apply the property as a rental.

Fair Housing and Others

There are federal, state, and even numerous local laws intended to protect tenants’ rights and prevent discrimination. So while being informed of your federal tenants’ rights laws is essential, you should very clearly understand whether your state has supplemented those laws with stricter versions of their own. You should additionally check attentively for any rent control policies that may apply, both current and those that will be enacted eventually.

Grasping well your local Landlord/Tenant laws and habitability standards will help warrant that you manage your investment property the correct way. Tenants’ rights laws can cover an unpredictable number of things, from security requirements to frequency and notification about rent increases.


Ascertaining all of the principal laws in Michigan can be a lot of work, thus it is reasonable for a number of rental property investors to hire Troy property management experts instead. At Real Property Management Metro Detroit, we find out all the ins and outs of state and federal laws and can nail down that your investment properties are leased and managed in accordance with those laws. Call today at 248-808-6550.

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