Michigan's New Short-Term Rental Act: What HB 6026 Means for Property Owners and Investors

If you own a short-term rental in Michigan — or you are thinking about buying one — May 21, 2026 is a date worth knowing. That is when State Representatives Joey Andrews (D-St. Joseph) and Matthew Bierlein (R-Vassar) introduced a bipartisan package of bills that would fundamentally reshape how short-term rentals operate across the state. The centerpiece is House Bill 6026, which would establish the Michigan Short-Term Rental Act and create the first statewide registry, safety framework, and excise tax structure for STRs in Michigan history.

The bill is still making its way through the Legislature and has not become law. But given the bipartisan support and the growing political momentum around STR regulation in Lansing, this is legislation that every Northern Michigan property owner, vacation home buyer, and real estate investor should be watching closely. Here is what the bill proposes — and what it could mean for you.

What HB 6026 Would Actually Require

The bill's most significant structural change is the creation of a statewide STR registry administered by the Michigan Department of Licensing and Regulatory Affairs (LARA). Under HB 6026, any owner of a short-term rental would be required to file an annual certificate with LARA that includes:

• The owner's name and address
• The address of the rental property
• Proof of at least $1 million in liability insurance
• Emergency contact information for a person residing within 30 miles of the rental

The registry would be accessible to local governments, law enforcement, and the public upon request — giving municipalities tools for monitoring and enforcement that they do not currently have under any unified state framework.

On the safety side, HB 6026 would require STRs to have working smoke detectors, carbon monoxide detectors, fire extinguishers, and posted emergency contact information and escape plans — standards that most responsible operators already follow but that are inconsistently enforced across Michigan's patchwork of local ordinances. The bill would also prohibit hosting platforms like Airbnb and VRBO from facilitating bookings for rentals that are not in good standing with local governments, a provision that puts significant enforcement leverage directly at the platform level.

The 6% Excise Tax — and Where the Money Goes

The provision generating the most attention in the real estate community is a proposed six percent excise tax on short-term rentals. Under the bill, that revenue would be split evenly: 50% goes to the municipality where the rental is located, and 50% flows to Pure Michigan, the state's tourism promotion program.

For property owners, the practical impact depends on how you operate. If you are already collecting and remitting Michigan's existing sales and use tax on short-term rentals — which you are required to do — the new excise tax would represent an additional layer of cost. On a $200 per night rental, a six percent excise tax adds $12 per night. Whether that gets passed on to guests or absorbed by operators will depend on market conditions in each community.

The split that directs half the revenue to local governments is arguably the more consequential piece. STR-heavy communities like those around Torch Lake, Walloon Lake, and Bellaire have long argued that the wear and tear on roads, emergency services, and public infrastructure from high STR volume is a real cost that local taxpayers currently absorb without a dedicated revenue stream. The proposed tax would change that — and it could reduce pressure on some of the more aggressive local STR bans and restrictions that have been rippling through Northern Michigan townships over the past several years.

What This Means for Northern Michigan STR Owners and Buyers

The Northern Michigan market — including the communities we work in across Antrim, Charlevoix, Emmet, Cheboygan, Kalkaska, Crawford, Mackinac, and Chippewa counties — has been one of the most STR-intensive regions in the state for years. That has made it ground zero for both the economic benefits and the regulatory tensions that HB 6026 is trying to address.

A few practical takeaways for STR owners and prospective buyers:

Registry compliance will be a real operational requirement. If HB 6026 passes, operating a short-term rental without a LARA certificate and $1 million in liability insurance will put you at risk of being blocked from booking platforms entirely. Operators who rely on Airbnb or VRBO for bookings and are not in good standing with the registry could find their listings delisted automatically. This raises the compliance floor for everyone and will likely push some casual operators out of the market.

Local STR rules still apply — and vary significantly.HB 6026 is a statewide framework, not a preemption of local authority. Municipalities retain the ability to enact and enforce their own reasonable regulations and zoning decisions on top of any state requirements. In Northern Michigan, this means the rules around Torch Lake's various townships, the ongoing situation in Bellaire, and county-by-county zoning differences will remain relevant even if the bill passes. Before purchasing any property with STR income potential, consulting with a local real estate attorney about township-specific rules remains essential. The statewide law, if passed, sets a floor — not a ceiling.

The excise tax could shift investment math. A six percent gross revenue tax is not trivial. On a Northern Michigan cabin grossing $40,000 per year in rental income, that is $2,400 in additional annual tax obligation. Buyers underwriting a vacation home purchase based on projected STR revenue should factor in this potential cost now, even before the bill passes, as a scenario planning exercise. STR income projections that do not account for a possible tax increase are optimistic assumptions at this point in the legislative cycle.

The insurance requirement matters.Most homeowner's policies do not cover short-term rental activity. Requiring proof of $1 million in liability insurance — which is standard for commercial STR operators but not always in place for casual hosts — will add operating costs for some owners. If you are currently renting without proper STR-specific coverage, that is a risk worth addressing regardless of whether HB 6026 passes.

Where Things Stand — and What to Watch

As of early June 2026, HB 6026 has been introduced and referred to committee. The bipartisan sponsorship is notable — Rep. Andrews (D) and Rep. Bierlein (R) represent districts with significant STR activity, and the package has been framed as a balance between protecting property rights and giving local communities the tools to manage STR impacts. That framing has broader appeal than purely restrictive legislation and increases the bill's chances of advancing.

What to watch: committee hearings and any amendments that emerge, particularly around the tax rate and how "good standing" with local governments is defined. Stakeholder groups on both sides — including the Michigan Short-Term Rental Association, municipal leagues, and tourism industry groups — will be active in shaping the final language. The bill as introduced is a starting point, not a final product.

For buyers and investors, the right posture right now is informed awareness. This legislation, combined with the existing patchwork of local STR rules across Michigan and the concurrent zoning reform bills moving through the Legislature, signals that the regulatory environment for Michigan real estate is changing faster than it has in years. Properties with STR income potential need to be evaluated with eyes open to that trajectory — and with guidance from agents who follow these changes closely.

Holly & Zoe track Michigan real estate law and STR legislation as part of what we bring to every client conversation. If you are weighing a purchase with vacation rental income as part of the picture, we can help you think through the regulatory landscape — not just today's rules, but where things are heading. As always, consult a local real estate attorney before making investment decisions based on proposed legislation that has not yet been enacted.