Grand Rapids Short Term Rental Regulation: A Guide For Airbnb Hosts

Do you own a place in Grand Rapids and you're weighing whether to put it on Airbnb or Vrbo? Well, the good news is that the city allows it, though not in the wide-open way most hosts picture. Grand Rapids, the Kent County seat and Michigan's second-largest city, licenses short-term rentals as a home occupation: you can rent a single room in the home you live in, or run a small owner-occupied bed and breakfast, and the City Clerk's licensing page spells out exactly how to apply for either one.

That permission comes rationed, though. The city issues only 200 of those licenses citywide, and an entire house or an accessory dwelling unit can't be licensed under the zoning ordinance no matter who owns it. As of February 2026, more than 1,000 Airbnb and Vrbo listings were live in the city, about five times what the ordinance permits, according to Crain's Grand Rapids Business. Most of what you see advertised right now is running outside the rules, and Mayor David LaGrand is already pushing the city to rewrite them.

So this guide walks through what Grand Rapids requires in 2026: how the two home occupation licenses work, what they cost, the three tax layers that stack on top, and how seriously the city polices the gap between the 200 legal listings and the thousand-plus illegal ones. Every figure below comes from the City of Grand Rapids', Kent County's, or the State of Michigan's own pages, checked in July 2026. Once you've got the rules straight, run the property through BNBCalc before you commit to anything.

Starting a Short Term Rental Business in Grand Rapids

Before you run any numbers, you need to know whether your specific property can even become a short-term rental, because in Grand Rapids that depends entirely on how you plan to use the home, not what you paid for it.

Michigan itself barely weighs in here. The state has no law preempting local short-term rental rules, and the Michigan Zoning Enabling Act sets only the outer bounds of local zoning power without ever mentioning short-term rentals. That leaves every city, township and county free to zone, cap or ban them however it likes, and Grand Rapids has used that freedom deliberately. Our Michigan short-term rental guide covers how differently that plays out once you leave the city limits.

Inside Grand Rapids, a short-term rental isn't its own category. It's licensed as a home occupation under Article 9 of the Zoning Ordinance and Chapter 116 of the City Code, which matters because a home occupation has to stay subordinate to the fact that someone actually lives there. Only two paths lead anywhere:

• Rent a single room, couch, or sleeping area in the home you live in, capped at two adult guests overnight, under a Home Occupation One-Room Rental License.
• Run a small bed and breakfast out of your owner-occupied home, up to five guest rooms, under a Home Occupation Class C License, which needs Planning Commission approval as a Special Land Use before the Clerk's office will even take your application.

Unfortunately for most people picturing a classic Airbnb investment, buying a house and renting the whole thing out nightly isn't on that list. An entire home, and an accessory dwelling unit built on the same lot, gets classified as "short-term lodging" right alongside hotels and motels: a commercial use permitted only in the city's mixed-use commercial districts, never in a residential zone. Michigan doesn't stop Grand Rapids from drawing that line, and Grand Rapids drew it a long time ago.

Short Term Rental Licensing Requirements in Grand Rapids

That line the city drew is also why the licensing process itself is narrower than in most cities. You're not applying for a generic short-term rental permit. You're applying for one of two specific home occupation licenses, and which one you need depends on how much of the house you plan to rent out.

Both licenses run through the City Clerk's Office, not Planning or Code Compliance, and both start the same way: you submit a home occupation application with a floor plan attached, and you pay a fee that doesn't come back whether the city approves you or not.

For the One-Room Rental License, you must be the sole owner, joint tenant, or joint tenant by the entireties of a home that's genuinely your principal residence, and you have to be in residence whenever you're renting. The first-issuance fee is $634, and renewal runs $229. Only 200 of these licenses exist citywide in any given licensing year, so it's worth applying well before you need the income, not after. Licenses renew every June on an unusual three-year fee cycle: full issuance fee in year one, the lower renewal fee in years two and three if no complaints are on file, then back to the full issuance fee in year four. A single sustained complaint resets that clock immediately.

For the Class C License covering a bed and breakfast, rooming house, or boarding house, the new-license fee is $646 and renewal is $190. Do check your zoning before you spend anything on floor plans, because a Class C application requires a Special Land Use Permit from the Planning Commission first, and that's a separate, more involved process than the license application itself. Call the Planning Department at 616-456-4100 to confirm your parcel qualifies before you file anything.

Bed and breakfast operation carries its own layer of detail once you're approved. The zoning ordinance limits guest rooms to one fewer than the total bedrooms in the house, up to five rooms maximum, at no more than two adults per room. You'll need one additional on-site parking space per guest room, on top of what your residence already requires, and street parking doesn't count. No bed and breakfast can sit within 500 feet of another one. Stays can't run longer than 30 consecutive days, guest rooms can't have their own cooking facilities, and you're allowed up to four special events a year, capped at two days each, if you want to host non-guests on the property.

Both license types also share a fire inspection. Make sure you keep your calendar open after you submit, because the Fire Department contacts applicants separately to schedule it, and it's a condition of approval rather than a formality.

Required Documents for Grand Rapids Short Term Rentals

That inspection is only one piece of the file the city wants, and it's worth assembling everything before you submit rather than scrambling afterward, since neither application fee refunds if something's missing.

For either license, expect to provide:

• Proof you own the property, as sole owner, joint tenant, or joint tenant by the entireties, matching the interest types the Clerk's Office accepts.
• A floor plan of the entire home, with the room or rooms being rented clearly labeled.
• A letter of approval from your condominium association, if the property is part of one. City licensing doesn't override an association's own rules.
• A clean account with the city. You'll need a valid driver's license and no outstanding debt to Grand Rapids, whether that's court fees, property taxes, parking tickets, or city income tax.
• Owner, partner, or officer information, including name, address, the last four digits of your Social Security number, driver's license or state ID number, date of birth, and email, required on the Class C application.
• A Special Land Use Permit Application to the Planning Department, submitted and approved before you file the Class C license application itself, for anyone pursuing a bed and breakfast.

One document people forget to check is their Principal Residence Exemption status. Renting out space in your home means you can't claim the full Principal Residence Exemption on your property taxes anymore, so it's worth getting that number from the City Assessor's Office at 616-456-3081 before you file, not after your first tax bill arrives.

Grand Rapids Short Term Rental Taxes

Assuming you clear all of that paperwork and are able to get your license issued, there's still tax to sort out on top of it. Three separate layers can apply to a single Grand Rapids booking, and they're collected by three different governments.

Tax	Rate	Collected by
Michigan use tax	6%	State of Michigan (Airbnb collects automatically; Vrbo does not)
Kent County Hotel-Motel Tax	8%, up from 5% effective January 1, 2025	Kent County Treasurer (Airbnb collects automatically)
Grand Rapids city income tax	1.5% residents, 0.75% nonresidents, on net rental profit	City of Grand Rapids Income Tax Department

The state layer is the Michigan use tax, which applies to any stay of 30 days or less and is remitted through Michigan Treasury Online. Airbnb's own tax page confirms it collects and remits this automatically on Michigan bookings. Vrbo doesn't, so if Vrbo or a direct booking is your channel, that 6% is on you to register for and file yourself.

The county layer is newer than most hosts realize. Kent County's Hotel-Motel Tax covers "persons engaged in the business of providing accommodations for dwelling, sleeping or lodging for transient guest," which includes licensed short-term rentals, and voters approved raising it from 5% to 8% on the August 6, 2024 ballot to help fund sports and entertainment facilities. That increase took effect January 1, 2025, and it's authorized under House Bill 5048, which amended the state's 1974 accommodations-tax act to let Kent County and several other counties ask voters for the higher rate. Payments are due the 15th of the month after the stay, and Kent County charges 1% interest per month on anything late. Stays of 30 or more consecutive days are exempt, the same threshold as the state tax. Airbnb's Michigan help page confirms it collects this one automatically too. I couldn't confirm whether Vrbo does the same for the county tax specifically, so treat that as something to check with Vrbo directly rather than assume.

The city's own share isn't a lodging tax at all. It's ordinary income tax, and it applies to your net rental profit the same way it applies to any other earnings. Grand Rapids charges 1.5% on residents and 0.75% on nonresidents, rental income is specifically listed as taxable, and returns are due by April 30 each year. Neither Airbnb nor Vrbo collects this one for you; it's a filing you handle separately with the Income Tax Department.

One more thing worth watching, going through the legislature's own bill tracker as of my July 2026 check: HB 5138, HB 5139 and HB 5140, introduced together in October 2025, would expand which local governments can put a voter-approved lodging tax on the ballot statewide. All three were still sitting in the House Economic Competitiveness Committee, so nothing has changed for Grand Rapids yet, but it's the kind of bill worth rechecking before you finalize a pricing model. If you're weighing a property elsewhere in the county instead of the city proper, our Kent County guide breaks down how the tax and licensing picture shifts once you're outside Grand Rapids.

Grand Rapids-wide Short Term Rental Rules

Whether you're inside Grand Rapids or just outside it elsewhere in Kent County, a handful of rules apply the same way to every licensed short-term rental in the city, on top of whichever license you hold.

Owner presence is non-negotiable. Both license types require the owner-operator to be in residence during every rental period. There's no absentee version of a Grand Rapids short-term rental, and the city built the whole system around that constraint rather than around inspections or insurance requirements.

Guest counts stay small. A one-room rental tops out at two adult guests overnight. A bed and breakfast caps at two adults per guest room across a maximum of five rooms, so even the largest legal Grand Rapids short-term rental sleeps ten people at most, and that's before you factor in the 500-foot separation rule keeping bed and breakfasts from clustering.

Thirty days is the ceiling, not the floor. Both license types stop being short-term the moment a stay runs 30 consecutive days or longer, at which point ordinary landlord-tenant rules take over instead.

Advertising has to match the license. Your license number has to appear in every advertisement for the rental, and the license itself has to be displayed somewhere on the property where guests can see it. Skipping either one is an easy way to turn a minor paperwork issue into a real one.

ADUs and entire homes stay off the table. An accessory dwelling unit "shall not be leased or rented for less than thirty (30) days, and shall not be used as a short-term rental" under the zoning ordinance's ADU rules. An entire non-owner-occupied home isn't a recognized nightly-rental use in a residential zone either.

Condo and HOA rules still apply. City licensing doesn't override an association's own prohibition on rentals, so it's worth getting that letter of approval before you assume a condo qualifies.

Does Grand Rapids strictly enforce STR rules?

That advertising requirement is a real incentive to stay compliant, and it hints at how enforcement actually works here: complaint-driven day to day, with a growing appetite at City Hall to close the gap between the rules on the books and the market outside them.

The numbers make the gap hard to miss. Against 200 licensed slots citywide, more than 1,000 Airbnb and Vrbo listings were live in Grand Rapids as of early 2026, about five times what the ordinance permits. When Code Compliance does act on an unaddressed warning, the fines run $265 to $370 per violation, plus court costs, reported by Crain's Grand Rapids Business. You can file a zoning complaint online, by phone, or in person with Code Compliance, and non-hazardous violations get a 21-day correction window before enforcement escalates.

Planning director Kristin Turkelson told Crain's that her department intends to buy software specifically to cross-reference third-party booking sites against the city's own license records, which is a meaningfully more active posture than most cities take toward unlicensed listings. She also confirmed the short-term rental policy is part of a citywide zoning ordinance rewrite that launched in late 2025 and is currently expected to take effect in summer 2027. Nothing has changed yet, though. As of my July 2026 check, today's host still operates under the same rules the city adopted in 2014: 200 licenses, owner-occupancy, a two-guest overnight cap.

That review is genuinely contested, not a formality on its way to a predetermined answer. Mayor David LaGrand, who owns a vacation home he rents short-term in Ottawa County, wants the city to drop the owner-occupancy requirement, allow larger guest groups, and let newly built ADUs into the licensing pool. Investor Ryan Ogle told Crain's he'd like the cap raised toward 1,000 licenses. Hotel owner Brad Veneklase argued the other way, calling the current rules "spot-on" precisely because owner-occupancy keeps someone accountable on site, unlike a full building rental. Keep in mind that any of this could land differently by the time it's adopted, so treat 2027 as a planning target rather than a promise.

How to Start a Short Term Rental Business in Grand Rapids

With those 2014 rules as the reality you're operating under today, work through the steps in this order, since doing them out of sequence is the easiest way to waste an application fee on a property that was never going to qualify.

1. Confirm your property can legally host at all. If you're not planning to live there full time, or you're picturing an entire home or an ADU on Airbnb, stop here and reconsider the property, not just the paperwork.
2. Call the Planning Department at 616-456-4100 to verify your zoning, especially if you're aiming for a Class C bed and breakfast license, which needs Special Land Use approval before anything else moves forward.
3. Check your Principal Residence Exemption impact with the City Assessor's Office at 616-456-3081, since renting a room affects it either way.
4. Gather your documents: proof of ownership, a floor plan with the rental space clearly marked, a condo association letter if applicable, and a clean account with the city.
5. Apply through the City Clerk's Office, online through Citizen Access, by mail, or in person on the second floor of City Hall, and pay the non-refundable fee, $634 for a one-room rental or $646 for a Class C license.
6. Schedule and pass your fire inspection. The Fire Department reaches out after you submit; don't let this step stall once it's scheduled.
7. Post your license and put the number in every ad the moment you're approved, since both are required from day one, not after your first booking.
8. Register for Michigan use tax through MTO, and confirm whether your booking platform is collecting Kent County's Hotel-Motel Tax on your behalf or whether that's on you.
9. Diarize your renewal. Licenses run one year, renew every June on the three-year fee cycle, and a single complaint resets you back to the full issuance fee.

Who to contact in Grand Rapids about Short Term Rental Regulations and Zoning

Whichever step trips you up, a handful of offices split the work between them, and knowing which one owns your question saves a lot of time on hold.

Licensing and applications

The City Clerk's Office, Business Licenses handles both home occupation license types from application through renewal.

• Address: 300 Monroe Ave NW, Second Floor, Grand Rapids, MI 49503
• Phone: 616-456-3016
• Email: [email protected]
• Hours: 8 a.m. to 5 p.m., Monday through Friday

Zoning and Special Land Use approval

The Planning Department confirms zoning eligibility and processes the Special Land Use application required for any Class C bed and breakfast license.

• Phone: 616-456-4100

Complaints and zoning violations

Code Compliance takes reports of unlicensed or noncompliant short-term rentals and enforces zoning violations generally.

• Address: 1120 Monroe Ave NW, Suite 300, Grand Rapids, MI 49503
• Phone: 616-456-3053
• Email: [email protected]
• Hours: 7:30 a.m. to 4 p.m., Monday through Friday
• General city line: 311 or 616-456-3000

City income tax

The Income Tax Department administers the 1.5%/0.75% tax on rental profit and handles annual filing.

• Address: 300 Monroe Ave NW, Third Floor, Grand Rapids, MI 49503
• Phone: (616) 456-3415
• Email: [email protected]
• Hours: 8 a.m. to 5 p.m., Monday through Friday

Kent County lodging tax

The Kent County Treasurer's Office administers the 8% Hotel-Motel Tax owed on top of city and state taxes.

• Address: 300 Monroe Avenue NW, Grand Rapids, MI 49503 (mail: PO Box Y, Grand Rapids, MI 49501)
• Phone: 616-632-7500 general, 616-632-7496 for hotel-motel tax specifically
• Hours: 8 a.m. to 5 p.m., Monday through Friday

Property tax exemption questions

The City Assessor's Office can confirm how renting part of your home affects your Principal Residence Exemption.

• Phone: 616-456-3081

What do Airbnb hosts in Grand Rapids on Reddit and Bigger Pockets think about local regulations?

Assuming you've made it through all of those offices and you're still interested, it helps to know what other hosts and investors say about operating here, and the sentiment splits pretty cleanly along one line: whether you already hold a license or you're hoping to get one someday.

On BiggerPockets, the consistent theme going back years is that Grand Rapids is a harder city to break into legally than the broader market data suggests. A 2019 thread on the Grand Rapids Airbnb market drew a blunt response from a local agent: "The City of Grand Rapids is very restrictive on Airbnb rentals." That's held up. An investor with capital ready to deploy still runs into the same 200-license ceiling and the same owner-occupancy requirement that existed then, so the practical advice hasn't changed much either: check your zoning and the license waitlist before you buy, not after.

The investors quoted in local coverage this year echo that frustration from a different angle. Ryan Ogle, a real estate broker who co-owns mixed-use buildings along Bridge Street, told Crain's he'd like to convert apartments there into short-term rentals once the soccer stadium nearby opens, but the current ordinance won't let him. Jordan Painter, co-host of the Michigan Short-Term Rentals Podcast, said he'd expand his management company into Grand Rapids the moment the policy changes, but not before. On the other side, hotel owner Brad Veneklase, whose own properties already operate as licensed short-term rentals under Airbnb and Vrbo listings, defends the owner-occupancy requirement as the thing that keeps someone accountable on site.

What almost nobody argues is that the current system is easy to work within if you're an out-of-state or absentee investor, because it isn't built for that host at all. If Grand Rapids isn't the right fit for your plans, our Rochester Hills guide covers another Michigan city with a genuinely different set of rules worth comparing against. And before you decide either way, pulling up the Grand Rapids market on BNBCalc is worth doing now that you know the licensing math you'd actually be working within.

Frequently Asked Questions

Can you legally run an Airbnb in Grand Rapids in 2026?

Only within narrow limits. You need a City of Grand Rapids home occupation license, either a One-Room Rental License capped at two adult guests or a Class C bed and breakfast license approved as a Special Land Use, and you must live in the home during every stay. Only 200 One-Room Rental licenses exist citywide. Entire homes, non-owner-occupied units, and accessory dwelling units can't be licensed at all, so most current Airbnb and Vrbo listings in the city are operating outside the rules.

How much does a Grand Rapids short-term rental license cost?

A Home Occupation One-Room Rental License costs $634 for first issuance and $229 to renew. A Class C bed and breakfast license costs $646 for first issuance and $190 to renew, on top of the separate Special Land Use approval process required from the Planning Commission. Both fees are non-refundable regardless of approval, and licenses run one year, renewing each June on a three-year fee cycle that resets to the full issuance fee if a complaint is filed against you.

Can you rent out an entire house in Grand Rapids on Airbnb?

No. Grand Rapids' zoning ordinance classifies whole-home nightly rentals as "short-term lodging," the same commercial category as hotels and motels, and permits that use only in mixed-use commercial zone districts, never in residential zones. Accessory dwelling units are explicitly barred from short-term rental use as well. The only legal short-term rentals in residential Grand Rapids are a single room in an owner-occupied home or a licensed, owner-occupied bed and breakfast.

What taxes do you pay on a Grand Rapids short-term rental?

Three layers can apply. Michigan's 6% use tax applies statewide to stays of 30 days or less, and Airbnb collects it automatically, though Vrbo does not. Kent County's Hotel-Motel Tax is 8% as of January 1, 2025, and Airbnb collects that automatically too. Grand Rapids also charges its ordinary city income tax, 1.5% for residents and 0.75% for nonresidents, on your net rental profit, filed separately with the city by April 30 each year.

What happens if you run an unlicensed short-term rental in Grand Rapids?

Code Compliance investigates complaints and gives non-hazardous violations a 21-day correction window before escalating. Unaddressed warnings can lead to fines between $265 and $370 per violation, plus court costs. The city has also said it plans to buy software that cross-references third-party booking sites against its own license records, which points toward more active enforcement, not less, even while the broader ordinance is under review.

Last verified: July 2026. Every ordinance, tax rate, state law, and contact detail in this guide links to or comes from its official source.