Michigan Landlords Continue to be the Targets of Tenant Advocacy Groups and Lansing
February 2nd, 2024 | By: Matthew I. Paletz, Esq.
“At our best, that’s what we are—a home of opportunity for people seeking a great life at a good cost of living… there just aren’t enough homes for growing families. Detroiters see higher rates when they re-sign. In other words, the rent is too damn high and we don’t have enough damn housing! “
Governor Gretchen Whitmer in her State of the State address – January 24, 2024
Michigan landlords, like many across the country, have been dealing with tenant advocacy groups shouting that “the rent is too damn high” for years. The phrase originated as a slogan of perennial New York Governor candidate, Jimmy McMillan.
Like most political rhetoric, the truth is sometimes buried in the details, never mind that property owners and landlords have absolutely nothing to do with citizens of the State of Michigan’s ability to make a living. In regards to rent being high, well, yes, rent is higher but is it “too high?” Let’s discuss.
Our office, privately with our clients, and publicly with the media, warned that there would be ramifications to two years of periodic eviction moratoriums during the pandemic. No business owner in any industry can make a profit on their investment when their customers are told that payments are optional. Not only did landlords need to find a way to make up for income shortfalls, but an unforeseen cavalcade of economic thunderstorms hit them and their tenants.
- Housing availability disappeared with higher interest rates and a subsequent lack of home inventory, which drove people to rental properties.
- Rising interest rates meant that it would be hard for multi-family investors and landlords to pay for their own bills and upgrades.
- Insurance costs across the country and in Michigan have skyrocketed.
- Government regulation over the operation of rental properties has multiplied exponentially since COVID.
- A lack of available labor to employ and make repairs to properties has made things much more expensive.
- Our court system has suddenly run amok, slowing down the eviction process and causing “ghost housing” and “zombie mobile homes”.
In a nutshell, landlords are feeling disenfranchised.
But with all the “rent is too damn high” rhetoric, let’s look at some facts.
- According to Zillow, the average monthly rent in Michigan for all bedroom and property types stands at $1,312 which is down $38 a month compared to 2023 at this time.
- That monthly rate is almost $700 a month less than the national average.
- In her State of the State speech, the Governor’s pledge to “build baby build” to end Michigan’s “housing crisis” was based on her concern that there wasn’t enough housing in areas including the tourist mecca of Traverse City or the sparsely populated environs of the U.P. But, looking at the state as a whole, again according to Zillow, there are now nearly 11,000 rental vacancies in the state.
Do you know what they can do in Lansing to help those who are attempting to get their properties rented? Let the landlords get their properties back in a reasonable time after their tenants stop paying. They need to put the courts back on track while also working to make Zoom courts more the norm and to allow landlords and tenants to streamline and live their lives. And while we’re at it, let’s do something to decrease regulation on property owners.
Jarrett Skorup, VP of communications and marketing at the Michigan think tank Mackinac Center for Public Policy, told The Detroit News that increased regulation on landlords will continue to hurt, not help, housing availability. “It kills investment and drives up rental cost,” he said. It’s absurd to put every reason for rent increases and a lack of housing at the landlord’s doorstep. This is a macroeconomic issue.
Likewise, additional calls to reinstate rent control will only continue to drive up rents. Yet, the “rent is too damn high” chants continue to push the envelope. While their efforts thus far have been unsuccessful, several special interest-driven state legislators have taken up the cause as well. We must not stop using facts to defend against them.
The Bottom Line: Through our social channels and in the media, Paletz Law will continue to be a loud and passionate advocate on behalf of our clients.