City Councilmember Travis Radina, D-Ward 3, told The Michigan Daily that the most common issue he hears about from his constituents is their trouble navigating the housing market in Ann Arbor as renters. Specifically, many renters say they are being pressured by their landlords to renew their lease early.
“Outside of some of the broader activist-led movements in town, this is one where folks are just consistently reaching out as individuals and contacting us about some of the problems that they’re experiencing,” Radina said.
The proposed Ordinance to Amend Chapter 105 of the city’s Housing Code aims to help tenants in the city by closing perceived loopholes in two existing housing ordinances: the Early Leasing Ordinance and the Right to Renew Ordinance, both of which were created to strengthen tenants’ rights. The new ordinance was approved unanimously by the City Council at their Feb. 20 meeting and will take effect if it is approved for a second time at their upcoming Monday meeting. This ordinance was a product of collaboration between the city’s Renters Commission, its nonvoting City Council liaisons Radina and Councilmember Cynthia Harrison, D-Ward 1, and city attorneys and landlord representatives, according to Radina.
The Ordinance to Amend Chapter 105 would alter the language of the existing Early Leasing Ordinance and Right to Renew Ordinance so that landlords could not make a renewal offer to tenants until 180 days into their current lease. If the new ordinance is passed, tenants would have 30 days to decide whether they want to renew after an offer is made. After 30 days, the landlord could either make a second renewal offer to the tenants or find new tenants to rent the property. Additionally, all deadlines and timing constraints regarding when landlords can show properties or sign leases with new tenants would be counted from the start of the current lease, rather than the end.
In 2021, the city updated its existing ELO to ensure landlords could not show properties to prospective tenants or sign leases with new tenants more than 150 days before the current lease ends. The ELO also required landlords to make a renewal offer to a property’s current tenants before the 150-day mark. The Right to Renew Ordinance, which was passed in October 2022, stipulates that landlords must make a renewal offer to tenants 180 days before the end of their current lease and says that unless landlords have “just cause” for not renewing a lease with a tenant, they must either allow tenants to renew their lease or provide relocation assistance.
Renters and tenant advocates have said that once the two ordinances went into effect, landlords began to find loopholes in the law. Student tenants reported landlords using waitlist agreements to find future tenants more than 150 days before the end of a property’s lease. A tenant leasing from Campus Management told The Daily in April 2022 that they were pressured to commit to renewing their lease more than 150 days before its end. According to the individual, their landlord said they could not guarantee the tenant would be able to renew their lease in March if they did not reserve a spot earlier.
The Ann Arbor Tenants Union said that after the passage of the Right to Renew Ordinance, some landlords have incentivized their tenants to renew early by telling them the rent price in their initial renewal offer would increase if the tenants did not agree to renew by a specific date. MLive reported that in October, CMB Property Management sent an email to each of their tenants to offer a rental rate for the upcoming year, which the company said would increase if they did not renew their lease by the end of the month.
In an email to The Daily, Rackham student Claire Arneson, chair of the Graduate Employees’ Organization’s Housing Caucus, wrote that some landlords make multiple renewal offers to pressure tenants into renewing earlier without technically violating the Right to Renew ordinance.
“Before the (proposed) amendment, the ordinance specified that the landlord is required to make a good faith renewal offer, but did not specify a time frame in which the renewal offer had to be made, except that an offer must be made before and be valid until 150 days before the lease end,” Arneson wrote. “This left a loophole: the landlord could extend multiple offers, starting as early in the lease as desired with an expiration date (earlier) than the 150-day mark, as long as another offer was extended such that it would be valid at 150 days before the lease end.”
In an interview with The Michigan Daily, Rackham student Nathan Kim, a member of the Ann Arbor Tenants Union’s Reboot Task Force, said they advocated for the prospective amendment ordinance because the issue of landlords pressuring tenants to renew early repeatedly came up during conversations the union had with tenants around Ann Arbor.
“We have been working with tenants across the city because of the issue of a violation of the Early Leasing Ordinance — whether explicit violations of the literal letter of the law or simply exploiting some of these loopholes — they have been happening, despite the strong laws that were passed in 2022,” Kim said.
An April 2023 report by the Renters Commission explored loopholes in the 2021 iteration of the ELO, specifically looking at the issue of waitlist agreements, sometimes called option agreements or holding agreements. Under these agreements, prospective tenants pay a fee, which the report found could range from $150 to nearly $10,000, to reserve a spot in an apartment if the current tenants do not renew.
Though the new amendment ordinance does not directly address the issue of waitlist fees, Radina said the Commission plans to introduce legislation to address these issues in March.
“(The proposed ordinance) is really cleaning up the existing law,” Radina said. “I am in the process right now of working with Councilmember Harrison and the renters commission on addressing the exorbitant waitlist fees and other rental junk fees that we’ve been seeing across the city. And so, that is something that we hope to bring in March for first reading and ultimately begin moving that forward as well because that is really where we’ve seen a lot of really predatory behavior.”
Under the current ELO and Right to Renew Ordinance, a property with a lease ending in August cannot legally be renewed or leased to a new tenant until March. This would remain the case under the Ordinance to Amend Chapter 105, as the ordinance requires that landlords allow tenants to consider a renewal offer for 30 days. This means landlords cannot show properties to new tenants or lease properties to new tenants until 210 days into the current lease.
In an interview with The Daily, James Nichols, executive director of the Washtenaw Area Apartment Association, an organization representing local landlords and property managers, said that his organization wishes the proposed amendment ordinance allowed landlords to make renewal offers as early as 150 days into the current lease. This would expand the window of time in which tenants could look for housing and landlords could find new tenants.
“Trying to fit thousands of renters and students in an eight-week to six-week gap is daunting not only for the students, but for us as property professionals trying to provide the best service and quality housing that we can,” Nichols said. “So we just think if we can get a little bit more time on that, it would be able to put us in a position that we can better serve the community.”
Nichols also said he believes renters should be able to waive their right to renew, which would allow landlords to start leasing some of their properties earlier in the school year.
“That way we can start getting people in before that renewal process starts, so that we’re not bugging (current tenants) during that high-pressure, high-stress timeframe during exams and everything else,” Nichols said. “(We want to do) anything we can do beforehand, which saves us time and money on the back end, which alleviates stress and pressure on our tenants and our landlords.”
Nichols added that in his experience, the majority of landlords want to reduce the burden on their tenants that may occur as a result of shortened windows for renters to find housing.
“We don’t want to put that pressure on our tenants,” Nichols said. “I know that from the city council’s perspective, they feel like landlords are the ones putting that pressure on (them). Our perspective is different. We think because the market is shortened, that that’s just created that hysteria.”
To Kim, though, the new ordinance is a triumph.
“It basically closes all the loopholes landlords have been exploiting, and it’s entirely a victory for tenants,” Kim said.
Radina said he hopes the ordinance will allow the Right to Renew and ELO to work as they were intended, enabling the city to enforce the ordinances more effectively.
“Ultimately, my hope and my goal here is really to get us back to the intent of the law as originally passed,” Radina said. “What we’re looking to do is actually make sure that we close some of these loopholes that have been identified, and that the intent of the law stands. … This is about strengthening the intent that’s already on the books, and making sure that we can actually hold landlords accountable when they are bad actors.”
Daily News Editor Abigail VanderMolen can be reached at vabigail@umich.edu.