Thinking about buying a place in Fennville and turning it into a short‑term rental? You’re not alone. With wineries, farms, and Lake Michigan beaches nearby, this pocket of Allegan County draws steady leisure travelers. In this guide, you’ll learn what drives demand, how local rules work, the numbers to run before you buy, and the operational best practices that keep bookings strong. Let’s dive in.
Why Fennville works for STRs
Fennville sits just inland from Lake Michigan in southwest Michigan. You’re close to beaches, agritourism, and popular lakeshore towns, which keeps vacation demand flowing. Typical STR properties here include single‑family homes, cottages, small farmhouses or barns, and homes near lakes or rivers.
Seasonality and demand drivers
Summer is peak season, especially from Memorial Day to Labor Day. Fall weekends remain active thanks to harvest events and color tours. Winter slows, aside from holidays or special events. Proximity to wineries, farms, boating and angling, parks, and regional festivals in nearby towns like Holland and Saugatuck/Douglas supports the calendar. Local visitor and events calendars can help you identify high‑demand dates.
Property types that perform
Homes with character, acreage, or unique settings can command premium rates for leisure travelers. Cottages and farm‑style stays do well when they are comfortable, well‑equipped, and photographed beautifully. Properties near water or with easy access to outdoor recreation tend to attract weekenders and summer families.
Know the rules before you buy
Short‑term rental regulation in Michigan is handled locally. Before you make an offer, verify the latest requirements with the City of Fennville and Allegan County.
Local zoning and registration
Confirm how short‑term rentals are treated in the municipal code. Some places register STRs or require permits, inspections, or business licenses. You should clarify permitted uses in residential districts and any rules for parking, occupancy limits, signage, and noise.
Taxes and who remits them
Michigan imposes state sales tax on short‑term lodging. The statewide rate has historically been 6 percent, but you should confirm the current rate with the Michigan Department of Treasury. Some cities or counties charge additional lodging or hotel taxes. Also check whether booking platforms collect and remit any taxes for this area. Even if a platform remits on your behalf, you are responsible for full compliance and accurate filings.
Safety and compliance
Many municipalities require smoke and carbon monoxide detectors, fire extinguishers, and safety inspections. Document your compliance to reduce risk. If the property sits in an HOA or a subdivision with deed restrictions, review the covenants for any STR limits.
Enforcement and penalties
Municipal codes often outline complaint procedures and fines. Penalties for unlicensed rentals or repeated violations can be significant, sometimes assessed per day. Ask the City about enforcement practices so you understand the expectations.
Run the numbers with seasonal reality
Your underwriting should reflect how STRs actually earn in Fennville: strong summers, active fall weekends, and a softer winter.
Build a conservative pro forma
Budget for the full picture:
- Purchase price, closing costs, furnishing, and setup
- Seasonally adjusted ADR and occupancy, plus platform and payment fees
- Cleaning and turnover expenses per booking
- Utilities, internet, lawn/snow, trash, and routine maintenance
- Property management fees if you outsource operations
- Insurance tailored to STR use, property taxes, reserves, and capital expenditures
- Debt service based on your loan terms
Metrics that matter
Track the indicators investors rely on:
- Net Operating Income from STR operations
- Cash‑on‑cash return based on your cash invested
- Cap rate for apples‑to‑apples comparisons
- Break‑even occupancy so you know your floor
Run sensitivity tests for lower occupancy or ADR dips to understand downside scenarios.
Get real comps and STR data
Use dedicated STR analytics providers to pull ADR, occupancy, and RevPAR at a hyperlocal level, filtered by bedroom count and property type. Compare recent sales for purchase pricing and browse similar furnished rentals to gauge achievable nightly rates and minimum stays. Look at 12‑ and 36‑month trends to see how performance has normalized post‑pandemic, and compare weekdays vs weekends.
Financing considerations
Investment loans differ from owner‑occupied mortgages. Expect higher down payments and stricter underwriting. Some lenders allow documented rental income on applications, while others apply conservative vacancy assumptions. Ask lenders about their approach to projected STR income and keep backup documentation of market performance.
Operations that drive five‑star returns
Strong operations lead to better reviews, more repeat bookings, and steadier cash flow.
Turnovers and cleaning
Frequent turnovers add cost and reduce available nights if schedules are tight. Set realistic turnover windows and line up reliable cleaners. Price cleaning fees appropriately for the size and complexity of your property.
Property management options
You can self‑manage, hire a local manager for limited services, or choose a full‑service company. Full‑service fees often range from about 15 to 35 percent of booking revenue depending on scope. Compare what’s included, from marketing and guest communication to maintenance and accounting.
Insurance and liability
Standard homeowner policies often exclude STR activity. Obtain STR‑specific or landlord coverage and consider a liability or umbrella policy. Clarify what platform damage protections do and do not cover, and set clear house rules, screening, and deposits.
Safety and accessibility
Install and maintain smoke and CO alarms, fire extinguishers, and clear egress paths. If you have gas appliances, schedule regular checks. Keep a written safety checklist and document compliance.
Be a good neighbor
Most complaints stem from parking, trash, and noise. Provide off‑street parking guidance, clear trash and recycling instructions, quiet hours, and a local contact for quick resolution.
Risks and how to mitigate them
Regulatory change
Local rules can evolve. Monitor City meetings and stay in contact with planning or zoning staff. Keep excellent neighbor relations and consider diversification across markets to reduce concentration risk.
Seasonality and cash reserves
Set aside reserves for winter and shoulder seasons. Offer longer minimum stays or off‑season discounts to maintain occupancy when demand softens.
Your next steps in Fennville
Use this simple checklist to move forward with confidence:
- Confirm current STR rules with Fennville City Hall and Allegan County
- Verify state and any local lodging taxes and how to register and remit
- Pull STR market data for your specific area and property type
- Run a 12‑month pro forma with conservative seasonal assumptions and a reserve buffer
- Get STR‑focused insurance quotes and confirm coverage for guest stays
- Review HOA covenants and deed restrictions, if applicable
- Budget for furnishing, cleaning, management, and ongoing maintenance
- Create a neighbor plan with house rules, parking, and a local point of contact
How we can help
You deserve a partner who understands both the design and the data. With 20+ years of West Michigan lakeshore experience, premium marketing, and vacation rental oversight, we help you identify the right property, model realistic returns, and elevate the guest experience through design, staging, and vendor coordination. We also support investor transactions and 1031 exchanges, and provide ongoing management options to simplify ownership.
Ready to explore Fennville short‑term rentals with a clear plan? Connect with Tammy Kerr for a personalized strategy and next steps.
FAQs
Are short‑term rentals legal in Fennville, Michigan?
- Short‑term rental rules are set locally, so you should verify current zoning, registration, and licensing with the City of Fennville before purchasing.
What taxes apply to a Fennville vacation rental?
- Michigan assesses state sales tax on short‑term lodging, and some localities add lodging taxes; confirm current rates and registration steps with the proper authorities.
When is peak season for Fennville STRs?
- Late spring through summer is the busiest period, with additional weekend demand in the fall for harvest and color season; winter demand is typically lower.
What property types tend to do well near Fennville?
- Cottages, single‑family homes, small farmhouses or barns, and homes near lakes or rivers perform well, especially those with character, acreage, or a unique experience.
How much should I budget for STR management?
- Full‑service management fees often range from about 15 to 35 percent of booking revenue depending on services; compare scopes, not just price.
Can I use projected STR income to qualify for a loan?
- Some lenders consider documented rental income, while others require conservative vacancy adjustments; discuss underwriting criteria with your lender early.