.png)
By Robin Simon, President, Harpoon Capital · About · LinkedIn · Author, The Book on DSCR Loans (Available on Amazon)
The best Michigan markets for real estate investors in 2027 pair low entry prices, from about $81,000 in Saginaw, with strong short-term rental potential, led by a 96 AirDNA score in Saginaw (Frankenmuth) and $52,251 in average annual STR revenue in Traverse City. Michigan combines affordable Midwest prices with Great Lakes tourism, and its six markets below run from Grand Rapids, the state's second-largest city, and the Lake Michigan resort town of Traverse City to the capital region of Lansing and East Lansing, the university towns of Ann Arbor and Kalamazoo and Saginaw, next door to the Bavarian-themed tourist town of Frankenmuth. Median sale prices run from about $81,000 in the city of Saginaw to about $485,000 in Traverse City (Redfin, 2026), and BiggerPockets puts rent-to-price ratios between 0.38% a month in Traverse City and 0.62% in Saginaw, with rents between about $950 and $1,460. Investors buying here typically finance with Michigan DSCR loans, which are qualified primarily based on the property rather than the borrower's personal income, and Michigan's mid-range prices keep the “DSCR Ratio” within reach on long-term rent in most of these markets.
This breakdown uses market data collected as of October 2026, the most current snapshot available heading into next year's buying season. If you're evaluating a purchase in the final months of 2026, keep in mind that your first full year of rental income, appreciation, or short-term rental revenue lands in 2027 regardless of when you close. A deal you underwrite today is already a 2027 investing decision, just one made with the freshest data available right now.
Michigan has no statewide short-term rental license or registry, but stays of 30 days or less carry the state's 6% use tax, which Airbnb collects for hosts, plus any county accommodations tax, such as Kent County's 8% in Grand Rapids, which Airbnb also collects, or Kalamazoo County's 5%, which hosts must file themselves (BNBCalc). Additionally, no state law limits local control, and in 2020 the Michigan Supreme Court upheld a township's power to keep STRs out of residential districts, so the local rules vary widely: Grand Rapids licenses only owner-occupied room rentals, Ann Arbor and Traverse City limit non-owner-occupied STRs to commercial or mixed-use districts, Lansing and Kalamazoo treat them as registered rentals, and Saginaw licenses them in a few higher-density districts. In practice, i.e. for an investor buying a nightly rental, the zoning at a specific address matters more than the market averages below.
Michigan's larger markets are also fast-moving. Homes in Grand Rapids are selling in a median of just 7 days, with 51.1% selling above list, and Redfin's “Compete Scores” run from 75 in Lansing (“very competitive”) down to 31 in Kalamazoo (“somewhat competitive”). Redfin search data shows Chicago and Detroit buyers looking at Grand Rapids (a net 388 and 336) and Chicago, New York and Los Angeles buyers looking at Ann Arbor more than any other metros.
Below, we break down six Michigan markets worth watching, using current data from Redfin, BiggerPockets, and AirDNA.
Note: Home price appreciation and rent-growth figures below come from Redfin's median sale price data and BiggerPockets' Market Finder, which use different methodologies and can vary from one another, so treat them as directional. BiggerPockets' Grand Rapids, Lansing and Kalamazoo figures cover their metro areas (Grand Rapids-Kentwood, Lansing-East Lansing and Kalamazoo-Portage). Several of Redfin's Michigan pages show figures that look unreliable (e.g. a 19.4% drop in Kalamazoo's price per square foot and a 12.2% drop in Ann Arbor's), so those figures are left out. AirDNA's Grand Rapids, Traverse City and Ann Arbor figures are submarkets of their own markets, while Lansing/East Lansing, Kalamazoo and Saginaw are submarkets of its Michigan Area market, and the Saginaw submarket includes Frankenmuth.
Furniture City's fast-moving market
Grand Rapids is Michigan's second-largest city, home to Corewell Health (formerly Spectrum Health), Steelcase and a growing medical and craft-beer scene, with the fastest-selling homes on this list. It is the market in the article where buyers have to move quickest – and where the STR rules are among the tightest.
BiggerPockets points to healthcare, education and manufacturing, with Spectrum Health and Steelcase among the major employers, and Redfin search data (April to June 2026) shows Chicago (a net 388), Detroit (336) and Denver (32) buyers looking at Grand Rapids most, with only 30% of local buyers searching to leave. However, First Street data on Redfin rates the flood risk as “major” (8% of properties). On the STR side, Grand Rapids licenses only owner-occupied rentals, i.e. a one-room rental license ($634 the first time and $229 to renew, capped at 200 citywide) or a Class C bed and breakfast license for up to five rooms, which also needs Special Land Use approval, with the owner in residence during every stay, and whole-home nightly rentals allowed only in mixed-use commercial districts, while stays carry the 6% state use tax and Kent County's 8% accommodations tax, both of which Airbnb collects (BNBCalc).
The Grand Rapids submarket posts an AirDNA score of 94/100, with Rental Demand (91), Investability (85) and Seasonality (82) leading, Revenue Growth (76) next, and Regulation (65) the “soft spot.” Annual revenue per listing averages $34,172 (up 2.8% year-over-year), with an average daily rate of $157.74 (up 2.6%) and occupancy of 66% (up 1.4%), the highest on the list. Total active listings sit at 633, up 1.8%, and larger homes outside the city carry the top end, such as a log cabin on a golf course with a hot tub ($165K a year at 58% occupancy).
Financing note: Harpoon Capital offers industry leading DSCR Loans for properties in Grand Rapids and all throughout the market area. Check out our full DSCR Loans Program here, or if you want a quote on what terms look like today, fill out this two-minute form!
Sources: Redfin Housing Market↗ · BiggerPockets Market Finder↗ · BNBCalc Grand Rapids STR Guide↗ · AirDNA Market Data↗
Investor Takeaway: Grand Rapids offers the fastest-selling homes and strong rent growth in Michigan, with Chicago and Detroit buyers looking in. Investors should generally be ready to offer above list within days, buy for the long-term rent inside the city, and look to the surrounding townships or commercial districts for nightly rentals.
Cherry Capital gains on Grand Traverse Bay
Traverse City sits at the base of Grand Traverse Bay on Lake Michigan, home to Munson Medical Center, the National Cherry Festival and a growing wine country on the Old Mission and Leelanau peninsulas, with the highest appreciation figure and the highest STR revenue on this list. It is the resort market in the article, with summer doing most of the work.
BiggerPockets points to tourism, healthcare, education and agriculture, with Munson Medical Center among the major employers, and the bay, the beaches, the wineries and the Sleeping Bear Dunes nearby draw visitors from across the Midwest each summer. However, prices are the highest on this list, so cash flow is harder to find. First Street data on Redfin rates the flood risk as “minor” (3% of properties). On the STR side, the city does not allow whole-home vacation rentals in its residential districts, only hosted tourist homes, while vacation home rentals in its non-residential districts need an annual $200 license and are capped at 25% in the C-1, C-2, D-2, HR and I districts, and the surrounding townships set their own rules (BNBCalc).
The Traverse City submarket posts an AirDNA score of 46/100, the lowest in the article, with Investability (84) leading, Regulation (63), Revenue Growth (58) and Rental Demand (56) next, and Seasonality (45) the “soft spot,” i.e. a summer-heavy market. Annual revenue per listing averages $52,251 (up 2.9% year-over-year), the highest in the article, with an average daily rate of $371.74 (up 3.2%), also the highest, and occupancy of 54% (down 1.3%). Total active listings sit at 2,048, down 5.7%, the deepest STR market in the article, and group lodges carry the top end, such as a nine-bedroom lodge with a pool ($298K a year). Note that this submarket reaches well beyond city limits, where township rules rather than the city's apply.
Financing note: Harpoon Capital offers industry leading DSCR Loans for properties in Traverse City and all throughout the market area. Check out our full DSCR Loans Program here, or if you want a quote on what terms look like today, fill out this two-minute form!
Sources: Redfin Housing Market↗ · BiggerPockets Market Finder↗ · BNBCalc Michigan STR Guide↗ · AirDNA Market Data↗
Investor Takeaway: Traverse City offers the highest appreciation and STR revenue in Michigan, on a summer resort economy. Investors should generally confirm the zoning or township rules for any planned nightly rental, underwrite on trailing twelve-month actuals that reflect the long off-season, and expect to pay up for proximity to the bay.
Capitol and campus cash flow
Lansing is Michigan's capital, and East Lansing next door is home to Michigan State University, with state government, MSU and healthcare behind a large rental base and one of the best rent ratios on this list. It is the cash-flow market in the article where buyers are competing hardest.
BiggerPockets points to government, healthcare and education, with the State of Michigan and Michigan State University among the major employers, and Redfin search data (April to June 2026) shows Detroit buyers (a net 66) looking at Lansing more than any other metro. However, 70% of local buyers searched to leave the area (October to December 2025), and First Street data on Redfin rates the flood risk as “moderate” (8% of properties). On the STR side, Lansing does not ban short-term rentals, but non-owner-occupied units must register as rentals and pass an inspection, while East Lansing restricts rentals in parts of the city through rental overlay districts, so investors should confirm the rules at each address, along with whether Ingham County's 8% accommodations tax applies to their rental (BNBCalc).
The Lansing/East Lansing submarket posts an AirDNA score of 90/100, with Rental Demand (92), Investability (89) and Seasonality (84) leading, Regulation (59) next, and Revenue Growth (57) the “soft spot.” Annual revenue per listing averages $26,628 (down 0.7% year-over-year), the lowest on the list, with an average daily rate of $125.83 (up 2.7%), also the lowest, and occupancy of 64% (down 1.4%). Total active listings sit at 540, up 4.0%, and amenity-packed group homes carry the top end, such as a six-bedroom home with a heated pool and bowling alley ($158K a year at 65% occupancy).
Financing note: Harpoon Capital offers industry leading DSCR Loans for properties in Lansing and East Lansing and all throughout the market area. Check out our full DSCR Loans Program here, or if you want a quote on what terms look like today, fill out this two-minute form!
Sources: Redfin Housing Market↗ · BiggerPockets Market Finder↗ · BNBCalc Lansing STR Guide↗ · AirDNA Market Data↗
Investor Takeaway: Lansing and East Lansing offer a 0.50% rent ratio and the most competitive sales market in Michigan, on a government and university job base. Investors should generally buy for the long-term rent, move quickly on well-priced listings, and register any non-owner-occupied rental with the city.
Thinking About One of These Markets?
Get a same-day DSCR Loan quote for a specific deal, or browse the full Harpoon Capital DSCR Loan Program to see rates, LTV, and qualification details before you keep reading.
Wolverine rents and a tightening rulebook
Ann Arbor is home to the University of Michigan and its medical center, about 40 miles west of Detroit, with the highest rents and some of the highest prices on this list. It is the premium college-town market in the article, where long-term rentals to students, staff and medical professionals carry the case.
BiggerPockets points to education, healthcare, technology and research, with the University of Michigan as the major economic engine, and Redfin search data (April to June 2026) shows Chicago (a net 216), New York (136) and Los Angeles (82) buyers looking at Ann Arbor most, with only 18% of local buyers searching to leave. However, First Street data on Redfin rates the flood risk as “minor” (4% of properties). On the STR side, Ann Arbor limits non-owner-occupied STRs to office, commercial and mixed-use districts, allows owner-occupied homestays and principal-residence rentals in residential zones, and charges $500 per unit a year, and in July 2026 the city council directed the city attorney to draft a proposed six-month pause on new STR licenses (BNBCalc).
The Ann Arbor submarket posts an AirDNA score of 55/100, with Rental Demand (72) and Revenue Growth (68) leading, Seasonality (66) and Investability (63) next, and Regulation (59) the “soft spot.” Annual revenue per listing averages $45,181 (up 6.9% year-over-year), the fastest revenue growth on the list, with an average daily rate of $273.66 (up 12.3%) and occupancy of 54% (down 3.9%). Total active listings sit at 669, up 0.1%, and football weekends and university events typically drive the peak nights.
Financing note: Harpoon Capital offers industry leading DSCR Loans for properties in Ann Arbor and all throughout the market area. Check out our full DSCR Loans Program here, or if you want a quote on what terms look like today, fill out this two-minute form!
Sources: Redfin Housing Market↗ · BiggerPockets Market Finder↗ · BNBCalc Ann Arbor STR Guide↗ · AirDNA Market Data↗
Investor Takeaway: Ann Arbor offers the highest rents and fastest-growing STR revenue in Michigan, on the University of Michigan's job base. Investors should generally buy for the long-term rent in residential neighborhoods, keep nightly rentals to the commercial and mixed-use districts, and watch for the proposed pause on new licenses.
Bronco-town value with rising prices
Kalamazoo sits midway between Chicago and Detroit, home to Western Michigan University, Bronson Healthcare and a large pharmaceutical and medical-device industry, with one of the best rent ratios and some of the fastest price growth on this list. It is a value market where homes still sell in under two weeks.
BiggerPockets points to education, healthcare, manufacturing and research, with Western Michigan University and Bronson Healthcare among the major employers, and Redfin search data (April to June 2026) shows Detroit (a net 104), Chicago (40) and Phoenix (12) buyers looking at Kalamazoo most. However, First Street data on Redfin rates the flood risk as “moderate” (7% of properties). On the STR side, Kalamazoo has no separate STR permit, but nightly rentals register and are inspected under the city's Chapter 17 housing code and are treated as a lodging use (a bed and breakfast or hotel/motel), and hosts must file Kalamazoo County's 5% accommodations tax themselves each month, since Airbnb does not collect it (BNBCalc).
The Kalamazoo submarket posts an AirDNA score of 92/100, with Investability (92) leading, Rental Demand (76), Revenue Growth (75) and Seasonality (74) next, and Regulation (70) the “soft spot.” Annual revenue per listing averages $28,807 (down 1.2% year-over-year), with an average daily rate of $148.95 (up 1.2%) and occupancy of 59% (down 2.0%). Total active listings sit at 313, down 9.3%, and distinctive homes carry the top end, such as a waterfront home ($96K a year at 62% occupancy) and Frank Lloyd Wright's Meyer House ($95K).
Financing note: Harpoon Capital offers industry leading DSCR Loans for properties in Kalamazoo and all throughout the market area. Check out our full DSCR Loans Program here, or if you want a quote on what terms look like today, fill out this two-minute form!
Sources: Redfin Housing Market↗ · BiggerPockets Market Finder↗ · BNBCalc Kalamazoo STR Guide↗ · AirDNA Market Data↗
Investor Takeaway: Kalamazoo offers fast price growth, a 0.45% rent ratio and a high-scoring STR market on a university and healthcare job base. Investors should generally move quickly on good listings, register and inspect any rental under the city's housing code, and budget for filing the county accommodations tax.
Bargain prices next door to “Little Bavaria”
Saginaw sits on the Saginaw River in Michigan's Thumb region, about 15 minutes from Frankenmuth, the Bavarian-themed town home to Bronner's CHRISTmas Wonderland and Zehnder's chicken dinners, which draws millions of visitors a year. It is the getaway market in the article – with the lowest prices and the highest STR score of all!
BiggerPockets points to healthcare, education and manufacturing, with Covenant HealthCare among the major employers, and Frankenmuth's festivals, shops and Christmas-season crowds keep nightly demand steady through the year, while the Great Lakes Bay Region's employers add business travel. However, the city of Saginaw's population is shrinking and its housing stock is older, so investors should generally underwrite each property carefully. First Street data on Redfin rates the flood risk as “minor” (4% of properties). On the STR side, the City of Saginaw's Ordinance O-263 (effective September 5, 2024) licenses both principal and non-principal residence STRs through the City Clerk in its R-3, R-4 and RMU districts, with a 10-guest cap and on-site parking, while Frankenmuth has its own STR policy and the surrounding townships set their own rules, and stays carry the 6% state use tax, which Airbnb collects (STR Profit Map).
The Saginaw submarket posts an AirDNA score of 96/100, the highest in the article, with Investability (100) and Rental Demand (80) leading, Revenue Growth (77) and Seasonality (74) next, and Regulation (72) the “soft spot.” Annual revenue per listing averages $38,668 (up 0.8% year-over-year), with an average daily rate of $228.74 (up 9.2%) and occupancy of 52% (down 6.8%). Total active listings sit at 153, up 7.0%, and Frankenmuth properties carry the top end, such as a historic estate in downtown Frankenmuth ($151K a year) and a festival-district rental ($110K at 77% occupancy).
Financing note: Saginaw-area deals often qualify on TTM actuals or STR revenue projections given the nightly revenue base, and Harpoon Capital offers industry leading DSCR Loans for properties throughout the market area. Check out our full DSCR Loans Program here, or if you want a quote on what terms look like today, fill out this two-minute form!
Sources: Redfin Housing Market↗ · BiggerPockets Market Finder↗ · STR Profit Map: Saginaw Rules↗ · AirDNA Market Data↗
Investor Takeaway: Saginaw offers the best rent ratio and the highest STR score in Michigan, with Frankenmuth's tourism next door. Investors should generally focus nightly rentals on Frankenmuth and the nearby townships after confirming local rules, or on Saginaw's licensed districts, buy for the long-term rent elsewhere in the city, and underwrite on trailing twelve-month actuals.
| MARKET | AIRDNA SCORE | ANNUAL REVENUE | AVG. DAILY RATE | OCCUPANCY | YOY LISTING GROWTH |
|---|---|---|---|---|---|
| Saginaw (Frankenmuth) | 96 | $38,668 (+0.8%) | $228.74 (+9.2%) | 52% (-6.8%) | +7.0% (153 listings) |
| Grand Rapids | 94 | $34,172 (+2.8%) | $157.74 (+2.6%) | 66% (+1.4%) | +1.8% (633 listings) |
| Kalamazoo | 92 | $28,807 (-1.2%) | $148.95 (+1.2%) | 59% (-2.0%) | -9.3% (313 listings) |
| Lansing / East Lansing | 90 | $26,628 (-0.7%) | $125.83 (+2.7%) | 64% (-1.4%) | +4.0% (540 listings) |
| Ann Arbor | 55 | $45,181 (+6.9%) | $273.66 (+12.3%) | 54% (-3.9%) | +0.1% (669 listings) |
| Traverse City | 46 | $52,251 (+2.9%) | $371.74 (+3.2%) | 54% (-1.3%) | -5.7% (2,048 listings) |
Source: AirDNA, current as of 2026. Scores and figures reflect each market or submarket as defined by AirDNA and may not correspond 1:1 with city or county boundaries. As of October 2026
A few patterns stand out. The two highest-earning markets, Traverse City and Ann Arbor, score lowest, held back by a summer-heavy season in Traverse City (Seasonality 45) and middling subscores across the board in Ann Arbor. The four lower-priced markets all score 90 or higher on more modest nightly rates, because steady occupancy and low entry prices count for more in AirDNA's score. Additionally, nightly rates rose in all six markets, led by Ann Arbor (12.3%) and Saginaw (9.2%), while occupancy fell in five of the six.
Michigan's real estate landscape offers a strategy for nearly every type of investor:
Market-level data is a starting point, not a substitute for underwriting the specific property, neighborhood and rental strategy in front of you. Michigan leaves STR rules to its cities and townships, which range from Grand Rapids' owner-occupancy rule to Ann Arbor's and Traverse City's commercial-district limits and Kalamazoo's rental registration and Saginaw's district-based license, and county accommodations taxes vary, so investors should confirm the zoning and tax setup at a specific address before they close.
If you are ready to invest in one of these markets, start with our Michigan DSCR loans page.
Sources: Redfin housing market data, BiggerPockets Market Finder, AirDNA market and submarket data (airdna.co), and BNBCalc's STR guides for Michigan, Grand Rapids, Lansing, Ann Arbor and Kalamazoo, and STR Profit Map. Data collected as of October 2026, ahead of the 2027 investing season.
There is no statewide STR license or registry, but stays of 30 days or less carry the 6% state use tax, which Airbnb collects, plus any county accommodations tax, and cities set their own rules, e.g. Grand Rapids licenses only owner-occupied rentals, Ann Arbor charges $500 per unit a year and limits non-owner-occupied STRs to commercial and mixed-use districts, and Lansing and Kalamazoo require non-owner-occupied rentals to register and pass an inspection.
No. Out-of-state and first-time investors can buy investment property in Michigan without any license. A DSCR loan qualifies you primarily based on the property itself rather than your personal income or professional credentials, which is part of why it's such a common financing tool for out-of-state buyers.
A DSCR (Debt Service Coverage Ratio) loan qualifies a property primarily based on the property (its rent, value and location) relative to its mortgage payment, rather than the borrower's personal income or tax returns. If the property's projected or actual rent covers the mortgage payment (a DSCR of 1.00x or higher), it's generally easier to qualify, and Harpoon Capital also offers options for deals below 1.00x.
Generally yes. No Michigan law limits local control over STRs, bills to do so have repeatedly stalled, and in June 2020 the Michigan Supreme Court (Reaume v Township of Spring Lake) upheld a township's decision to keep STRs out of a residential district (BNBCalc). Investors should typically confirm the zoning with the specific city or township, not just the county, before making an offer.
Harpoon Capital's DSCR loan program allows as little as 15% down on qualifying purchases, up to 85% LTV, with cash-out refinances available up to 80% LTV. Exact terms depend on the property, credit profile, and DSCR ratio. Fill out our DSCR Loan Application to see specific numbers for your deal.
Ready to Run the Numbers on a Michigan Deal?
Whether you're eyeing a fast-moving deal in Grand Rapids or a Frankenmuth getaway near Saginaw, get a same-day rate and terms with our two-minute DSCR quote form, or explore the full Michigan DSCR Loans Program to see how we qualify the property, not just the borrower.
This article is for informational purposes only and does not constitute investment, legal, or financial advice. Harpoon Capital encourages investors to conduct independent due diligence before making any real estate investment decision.