When you’re raising a tenant’s rent, don’t communicate it casually or start charging the new rate out of the blue. Instead, make sure you comply with all Michigan rent increase laws. Although the Great Lakes State doesn’t enforce rent control, landlord-tenant laws still regulate how you adjust prices.
Remember, changing your tenant’s rent payment is a routine part of landlording. Here’s a helpful guide from TurboTenant to make it as easy as possible — including our free Michigan-compliant rent increase letter.
Is there a rent increase limit in Michigan?
First, let’s run through a quick overview of Michigan rent increase laws:
Statewide caps: Michigan law permits landlords to raise rent at the end of a lease term, but it doesn’t set a specific cap. Consider your local market rate to determine a competitive price based on local demand, square footage, and property features.
Local rent control ordinances: Additionally, state law prohibits local governments from enforcing rent control (Mich. Comp. Laws § 123.411). In other words, no city or county limits rent increases.
Exceptions: While Michigan bans rent control, the state’s policy doesn’t override federal housing programs, including Section 8.
Rent Increase Notice Periods
State law doesn’t outline specific notice requirements for increasing rent. As a result, landlords generally follow the state’s rules for terminating a rental agreement. Like most states, Michigan sets notice requirements based on the type of lease agreement. Here’s how it works:
Month-to-Month
Provide 1 month’s notice for a month-to-month agreement. But if your lease is shorter than 3 months, give notice equal to the interval between rent payments (Mich. Comp. Laws § 554.134).
Pro Tip: Michigan law applies the same notice requirements to room rental agreements (Mich. Comp. Laws § 554.134).
Fixed-Term
Landlords must wait until they’re renewing their lease to propose a new rent price. However, state law doesn’t mandate advance notice. We recommend giving tenants at least 1 month’s notice to keep your process transparent and professional.
How to Deliver a Rent Increase Notice in Michigan
Top landlords in Michigan use the following delivery methods when sending rent increase letters:
- Give the notice to the tenant directly.
- Drop off the letter at the property.
- Send it via Certified Mail.
- Use landlord software to send it digitally.
Make sure you add a clause in your lease outlining how you deliver official notices — especially if you’re sending electronic notices. Have both parties agree in writing for legal compliance.
Keep in Mind: When mailing your document, add 3 days to the notice period to make sure tenants receive the letter before you start the clock.
Understanding Illegal Rent Increase and Retaliation
Michigan rent increase laws protect tenants from retaliation. Landlords can’t adjust their rent price to get back at tenants for the following:
- Complaining to a government agency about housing code violations
- Exercising their legal rights
- Reporting code violations or uninhabitable living conditions
Additionally, courts consider a rent increase retaliatory if the landlord raises rent within 90 days of the above actions (Mich. Comp. Laws § 600.5720).
Pro Tip: If you need to raise a tenant’s rent during the 90-day presumption window, speak with a trusted real estate lawyer first.
Furthermore, federal laws prohibit discrimination against tenants. When raising rent, never offer unequal rental terms or consider the protected characteristics, including:
- Race
- Color
- National origin
- Religion
- Sex
- Familial status
- Disability (Fair Housing Act)
As a rule of thumb, always be consistent, fair, and honest. And don’t attempt a mid-lease hike unless your lease allows it. Without a clause permitting rate adjustments, you breach the agreement and become liable for penalties.
How to Write a Michigan-Compliant Rent Increase Letter
First off, make sure your notice is clear, professional, and respectful. Keep everyone on the same page by adding the following to your rent increase letter:
- Full property address and unit number
- Tenant names
- Exact dollar amount of the increase
- New total rent amount
- Effective date (based on Michigan’s rent increase laws)
- Instructions for tenants
We don’t recommend writing the letter manually every time. Instead, use a standardized template to avoid miscommunication. Download TurboTenant’s free rent increase letter template now to simplify your workload.
Managing the Rent Increase Process with Tenants
After you send your letter proposing the new rate, it’s up to your tenant to accept, deny, or negotiate. Follow these best practices to get the job done:
- Accept: Prepare the renewal contract, outlining your updated rental terms and price details. Because Michigan doesn’t require grace periods, start charging the new rate on the effective date.
- Reject: If a tenant refuses your rent increase, they must move out at the end of their current lease. Discuss the move-out process and get ready to find, screen, and secure your next tenant.
- Negotiate: If a great tenant asks to work out a deal, consider meeting them in the middle — but only when it makes sense. Some landlords offer longer lease terms or even delay the start date of the increase.
At the end of the day, Michigan rent increase laws aren’t as strict as the rules in other jurisdictions. But you still have to cross your T’s and dot your I’s. Use this guide to make the lease renewal process seamless, simple, and stress-free.
Michigan Rent Increase FAQs
How much can I raise rent in Michigan?
State law doesn’t cap rent increase amounts. As a result, landlords can increase their unit’s rate as needed. However, you must notify tenants if you use a tenancy-at-will agreement (Mich. Comp. Laws § 554.134).
Is there a maximum late fee in Michigan?
State law doesn’t regulate late fees. If you’re going to charge one, make sure you outline your full policy for late payment penalties in your lease.
Can I increase rent if the tenant is on a verbal agreement?
Landlords can raise rent whether they have a verbal or written agreement. But first, rental owners must comply with the state’s notice requirements for month-to-month verbal agreements (Mich. Comp. Laws § 554.134). All things considered, we recommend using a written lease rather than relying on word of mouth.