Chelsea, MI asked in Real Estate Law for Michigan

Q: Can a home be considered a "rental" property even though the payments made by an occupant only cover utility costs?

My family pays only the approximate cost of utilities to stay in our friends' home while they live in another state to assist their family members. The local governing authority now is calling the subject home a "rental" property (charging them higher taxes) even though our friends' intent is not to make money from the property, but to help out my family and to keep the home from deteriorating through our supervision. We have been staying in the home for five years now. It does not seem right to call this house a "rental" unit or an "investment" property. Our friends lived here (in the subject home) for many years before they moved out of state to help their family members.

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1 Lawyer Answer
Kenneth V Zichi
Kenneth V Zichi
Answered
  • Fowlerville, MI
  • Licensed in Michigan

A: The question isn't 'rental' or investment but is this HOMESTEAD property. If you've lived there for five years, it is pretty clear it is no longer owner occupied and is therefore subject to school tax.

Your friend should consult with a local real estate lawyer to look into the details of their situation. It MAY be possible to salvage the situation, but depending on local practice and ordinances, there is no time to delay with this! Seek local legal help ASAP!

--The answer is provided for general information only, and does not create an attorney/client relationship. If you have questions you should consult with a local attorney. I am licensed to practice in Michigan only.

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