The "Rental Audit": How BSEED Finds Unregistered Landlords
Category: Compliance Guide
Violation: 8-15-81 (Failure to Register Rental)
For years, Detroit had a "Voluntary Compliance" approach to rental registration. That era is over.
BSEED (Buildings, Safety Engineering, and Environmental Department) has digitized its enforcement. They are now conducting "Data Audits" to identify unregistered rentals without ever leaving their desks.
The "Tax Affidavit" Trap
Here is how they find you:
- Tax Data: They pull the City Assessor's database for properties marked "Non-Owner Occupied" (meaning the owner does not claim the Principal Residence Exemption).
- Rental Registry: They compare that list against the active Rental Registration database.
- The Match: If you are "Non-Owner Occupied" but "Not Registered," the system flags you as a probable unregistered landlord.
The Result: Code 8-15-81
You will receive a ticket for Failure to Register Rental Property.
- Fine: $250.00
- Consequence: This ticket blocks your Certificate of Compliance (CoC).
- Escrow Risk: Without the CoC, your tenants can withhold rent.
The Myth of the "Vacant" Excuse
Investors often try to argue: "It's not a rental! It's vacant!" If you use this defense, BSEED will simply check if you have a Vacant Property Registration (Code 8-15-110).
- If you don't have that either, they will just switch the ticket to a Vacant Property violation (which is often more expensive).
The Solution
You must pick a lane.
- If it's a rental: Register it (even if it's not compliant yet). The registration prevents the 8-15-81 ticket.
- If it's vacant: Register it as vacant.
Do not stay in the "Grey Zone." The data audit will find you.