Ann Arbor Rental Application Fee Cap Law 2025

Ann Arbor's rental fee rules didn't arrive all at once. The original ban on pre-tenancy fees and the $50 application fee cap took effect January 26, 2025, under Ordinance ORD-24-33. A second ordinance, ORD-26-04, amended the same code section and took effect August 1, 2026, adding an entirely separate mandatory-versus-optional fee framework.

[Cite: Ann Arbor City Code, Chapter 105, §8:532; Ordinance ORD-24-33 approval notice; Ordinance ORD-26-04 approval notice]

A landlord who researched this rule when it first passed and hasn't checked back since is very likely working from an outdated picture of what's actually required now.

The 2025 ordinance prohibits "wait list fees, holding fees, option fees, preparation fees, move-in fees or any other fee incurred prior to the start of a term."

[Cite: Ordinance ORD-24-33 approval notice, Ann Arbor City Code §8:532]

That's a broad, catch-all category covering any charge tied to the period before a lease term actually begins, not just the five specifically named fee types.

A rental application fee can't exceed $50, and a landlord must fully refund that fee if the applicant isn't offered the unit, no later than 60 days after the landlord received it.

[Cite: Ordinance ORD-24-33 approval notice, Ann Arbor City Code §8:532]

That 60-day refund clock runs from when the landlord received the fee, not from when a final leasing decision is made. A landlord sitting on an application for an extended period before deciding still has to meet that 60-day refund deadline if the applicant ultimately isn't offered the unit.

Effective August 1, 2026, Ordinance ORD-26-04 introduces a distinction between mandatory tenancy fees and optional tenancy fees. A mandatory fee, one a tenant cannot reasonably decline, can no longer be charged as a separate line item; it has to be disclosed and advertised as part of the base rent.

[Cite: Ordinance ORD-26-04 approval notice; A2Council, "Ann Arbor City Council: February 2, 2026" meeting summary]

That's a meaningfully different requirement from the 2025 rule. The 2025 ordinance addressed fees charged before a lease starts; this 2026 amendment addresses how ongoing, unavoidable fees during the tenancy itself get priced and disclosed.

A city official involved in the ordinance framed the goal as letting tenants "shop apples to apples," so the advertised rent figure reflects what a tenant will actually pay, rather than a lower number followed by fees added later that the tenant had no real way to avoid.

[Cite: WEMU-FM, "Ann Arbor to consider ban on mandatory rental fees"]

A fee tied to something every tenant in a building is required to have, an amenity charge applied regardless of whether the tenant uses the amenity, or a flat administrative fee baked into every lease, falls into this mandatory category and now has to be part of the advertised rent rather than a separate charge.

A genuinely optional fee, one a tenant can decline, such as a parking fee or a pet fee, remains permitted as a separate charge.

[Cite: A2Council, "Ann Arbor City Council: February 2, 2026" meeting summary]

But that fee has to be listed on the first page of the lease agreement, or clearly in a single addendum, rather than buried across multiple documents or disclosed only after signing.

[Cite: A2Council, "Ann Arbor City Council: February 2, 2026" meeting summary]

A landlord can't charge a parking fee, for example, if the tenant hasn't actually agreed to use the parking amenity.

[Cite: A2Council, "Ann Arbor City Council: February 2, 2026" meeting summary]

That ties the "optional" label to actual tenant choice, not just to a fee's category name. A parking fee applied to every unit regardless of whether a tenant has a car or wants a space isn't really optional in practice, and a landlord treating it as a standard, unavoidable charge risks it being reclassified as a mandatory fee that should have been folded into rent instead.

Security deposits and utility charges are excluded from the mandatory-versus-optional framework entirely.

[Cite: WEMU-FM, "Ann Arbor to consider ban on mandatory rental fees"]

A landlord doesn't need to fold a security deposit or a utility bill into the advertised base rent to comply with this specific amendment; those charges are governed by their own separate rules and aren't part of what this ordinance restructures.

Ordinance ORD-26-04 had its first reading January 20, 2026, was adopted February 2, 2026, and didn't become effective until August 1, 2026, roughly six months later.

[Cite: Ordinance ORD-26-04 approval notice]

That gap gave landlords time to review existing lease templates and fee structures against the new mandatory-versus-optional distinction before it became enforceable, similar to the runway built into the original 2025 ordinance's own effective-date structure.

The 2025 ordinance addressed fees charged before a tenant signs a lease. It didn't address a mandatory fee baked into a lease and charged throughout the tenancy itself, as long as that fee wasn't technically incurred before the lease term started.

[Cite: Ordinance ORD-24-33 approval notice; Ordinance ORD-26-04 approval notice]

A landlord who eliminated pre-tenancy fees in 2025 but continued charging a flat, unavoidable monthly amenity fee throughout the lease term was fully compliant with the original ordinance. That same practice now needs review under the 2026 amendment, since a fee like that likely qualifies as mandatory and has to be part of the advertised rent instead.

Neither ordinance's approval notice, nor any secondary source reviewed for this article, specifies a civil infraction process, a specific penalty amount, or a named enforcement department for a violation of either the 2025 or 2026 rules.

[Cite: Ordinance ORD-24-33 approval notice; Ordinance ORD-26-04 approval notice]

That's worth stating plainly rather than guessing at a figure. A landlord researching potential exposure for noncompliance should check directly with the City of Ann Arbor or Ann Arbor's Renters Commission for current enforcement guidance, since it wasn't confirmed through available sources for this article.

The Washtenaw Area Apartment Association's executive director described the original pre-tenancy fee ordinance as creating "additional hurdles for housing providers who are already facing significant challenges."

[Cite: Washtenaw Area Apartment Association, "Ann Arbor Passes Landmark Ordinance Banning Pre-Tenancy Fees"]

That industry pushback is useful context for understanding the ongoing tension behind these rules, but it doesn't change the compliance obligation itself for a landlord operating in Ann Arbor now.

A landlord or management company operating properties both inside and outside Ann Arbor needs a fee policy that treats Ann Arbor properties differently from the rest of a Michigan portfolio, since this is a municipal ordinance specific to Ann Arbor rather than a statewide rule.

[Cite: Ann Arbor City Code, Chapter 105, §8:532]

A standard, portfolio-wide fee structure that works elsewhere in Michigan may not satisfy Ann Arbor's specific application fee cap, pre-tenancy fee ban, or mandatory-fee disclosure requirement.

The practical starting point is auditing every Ann Arbor lease template and fee schedule against both ordinances separately: confirming no pre-tenancy fee survives from the 2025 list, and then reviewing every currently charged fee to determine whether it's genuinely optional or effectively mandatory under the 2026 amendment.

For any fee that tenants can't realistically decline, folding it into the advertised base rent rather than continuing to list it as a separate charge closes the most direct compliance gap created by the newer rule, and moving any surviving optional fees onto the first page of the lease or a single clear addendum closes the second.