Investors and thier agents need to know about the local Zoning

My town of Grand Haven is a very tourist community. With that comes a lot of rental cottages around town. A lot of the people are able to get what we call a "Winter Renter" for the months of Sept-May and then rent weekly in the summer tourism months. It is a great investment. If you are well informed.

I met a woman who purchased a cottage style home and it was licensed as a rental. It was in an area that the tourist love....walking distance to downtown, the pier, boardwalk, parks and Lake Michigan. She assumed that she would rent it out in the winter months and then do the weekly rentals all summer long. After she began renting weekly, the City contacted her and told her that this home was not zoned for "Seasonal Rentals" and that she would need to cease all weekly rentals immediately. You can imagine her shock and disbelief. She purchase this as an investment property only to find out that there are two types of Licensed Rentals in the area. Also, the zoning areas had changed for the "Seasonal Rentals" due to many of the areas being high residential and the folks living in those areas did not want it to become Party Central during the summer months.

She assumed and her realtor either did not know the zoning guidelines or just did'nt speak up at the time of purchase. She was given the Rental License at the time of closing, but it was not for the type of renting she intended to do. Now she owns an investment property that she never would of purchased if given the correct information.

The moral to this story is....KNOW your zoning. Especially in a resort town where a lot of people like to invest in rental properties. Just because it looks like a great location for rentals...does not mean that it can be used as such. Zoning changes. You need to keep well informed if you sell to investors!