312 S. Thayer St. is a three-unit apartment complex between the Diag and North Quad Residence Hall. The building itself is unremarkable with its plain, off-white siding, exposed concrete foundation and awkward, triangular profile which leans above the Jamaican restaurant next door. A cluster of spiked weeds peek from a corner of the building, and the adjacent sidewalk is stained and worn from years of student traffic.
What is notable, however, is the fact that 312 S. Thayer St.’s public listing fails to mention the $9,850 waitlist fee, discovered in a report produced by The Waitlist Working Group of the Ann Arbor Renters Commission.
According to the policy of Prime Student Housing, the building’s landlord, before prospective tenants can even set foot in the building, they have to pay nearly ten grand — not so that they can sign the lease, but so they can have the chance of signing the lease. They are asked to pay a junk fee.
Since the COVID-19 pandemic, many of Ann Arbor’s largest landlords, such as Prime Student Housing, Campus Management and Varsity Management, have begun to expand their charging of so-called “junk fees.” Put simply, a junk fee is any charge, fine or payment landlords demand of their tenant which does not actually provide for any service. And to make things worse, more often than not, these junk fees are not advertised to the tenant when they apply — one of the many reasons why they ought to be abolished.
In Ann Arbor, pre-tenancy fees, a type of junk fee charged before tenants move into their apartments, are particularly egregious. In a city with rent higher than most of Michigan, other landlords now ask for money even before you sign a lease. Prime Student Housing asks for an “earnest money fee,”Campus Management for an “option to lease fee” and Landmark Apartments for a generic “application fee.” In each of these cases, the fee must be paid before a prospective tenant even sees their contract.
According to the National Consumer Law Center, similar fees range from $25 to $350 nationally. In Ann Arbor, they are frequently between $50 and $500. Some are as high as $10,000.
Some landlords, such as Howard Hanna, “guarantee” a full refund. According to the report, however, when a group of prospective renters asked Hanna Realty for the return of their $200 application fee, it took five emails — and the threat of legal action — to finally get their money back.
Students are particularly vulnerable to pre-tenancy fees. As the University fails to provide adequate housing and the average rent in Ann Arbor approaches $2,000 a month, students are in a rat-race to secure affordable housing before fall. Caught between the pressure of securing housing and landlords demanding $50, $200 or even $10,000 in pre-tenancy fees, students often have no choice but to pay. One U-M student interviewed by CBS News said about her experience, “You have to be really careful because it feels like a scam. And sometimes, maybe it is.”
Even after pre-tenancy fees — and outrageous rent — many Ann Arbor landlords charge so-called “hidden fees,” which are often unmentioned in a tenant’s contract, according to Zackariah Farah, a student tenant and organizer involved with the Ann Arbor Tenants Union. He also spoke to me about members experiencing sudden increases in utility fees, new “no hassle” fees and charges for unspecified “administrative costs,” describing these policies as a reality of living in Ann Arbor.
Of course, some hidden fees are “justified” by landlords. It’s true, some do actually cover real expenses, but their amounts are often unreasonable. Another tenant explained to me that their landlord charged them $600 a year for a single, unpaved parking space. They chose to park a block away instead.
Under Ann Arbor law, landlords can charge new fees at whatever time, whatever reason and for whatever amount they want. Campus Management has recently introduced “move-in” fees, which can be as high as $2,100, alongside new, mandatory fees for cleaning — which can be anywhere from $135 to $500 per unit. If landlords can invent new fees whenever they like, is it really your money?
At 312 S. Thayer St. — and all over Ann Arbor — landlords hold extreme power over their tenants. They charge exploitative pre-tenancy fees to make an extra buck, and then spring residents with new hidden fees. If the Ann Arbor City Council cares about the financial wellbeing of their citizens or their economic rights they ought to take immediate action against junk fees. Cities such as Grand Rapids have already restricted them, and the state of Massachusetts has banned them outright. In Ann Arbor, too, tenants have organized, demanding that the City Council ban waitlist fees, force landlords to advertise the true cost of living in their units and end their predatory behavior. The solution to this exploitation is simple: It is time to trash the junk fees.
U-M Sophomore Aidan Rozema can be reached at arozema@umich.edu.
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