Debate over restricting new short-term rentals in New Buffalo heats up

NEW BUFFALO, Mich. — New Buffalo has been under a short-term rental moratorium since May 2020 so the city could work to amend its zoning ordinance. 

Since that time, state legislation has been introduced to restrict municipalities from regulating these rentals – the stance many renters are pushing for as well. 

In the city’s 2.2 square miles, 150 homes hold short-term rental licenses. 

The city doesn’t plan to do anything to change those permits, they are, however, proposing to limit where any new rentals can be.  

“As it stands, we have no wording in any document that short-term rentals are a legal use, they’re only legal through a permit, what we’d like to do is regulate the use of short-term rentals in residential districts,” said Mayor John Humphrey.

New licenses could only be issued in commercial or waterfront districts if their ordinance passes. 

Tuesday night, the planning commission decided not to issue a vote and asked for more data from the city on concerns about how unlimited rentals would hurt the economy and schools. 

Some argue New Buffalo has always been a resort community.

“The season is getting longer – people are coming in the fall and winter – and now these businesses that were maybe only open five months are now open year round,” said Jason Milovich, owner of Blue Fish Vacation Rentals. 

And it’s a property owners right to rent regardless of if they’re a seasonal resident. 

“You don’t have the rentals and the houses sit nine, 10 months out of the year – closed, boarded up and people aren’t coming to the restaurants – and you’re relying on just local support, there’s not enough people here to do that,” said Milovich. 

In the meantime, dozens of applications from potential renters remain on hold under the city’s moratorium, and if new zoning is ultimately passed, they can only hope their house falls in the right district.  

“We want to lift it November 1st – we’re going to have to lift it regardless – the problem is getting these ordinances so we can rezone the city, we’re trying to get this done before that,” said Mayor Humphrey.

There would be two exceptions to the ordinance in residential zones if it passes for condominiums and for people renting for over 30 days. 

The license would also continue to be accepted on the property even if the homeowner changes.

According to the mayor, second homeowners do pay additional taxes, but short-term rentals pay zero taxes on profits.