Airbnb DSCR Loans California: STR Financing Guide

For Existing STR Properties

For New STR Conversions

Can I get a DSCR loan for a new Airbnb with no rental history?

Yes! Lenders use professional market analysis tools like AirDNA to project income based on comparable properties. You'll need a strong market with proven STR demand, and the lender will typically use conservative occupancy estimates (60-65%).

How do seasonal fluctuations affect DSCR calculations?

Lenders average income over 12 months, smoothing out seasonal variations. For example, a ski resort property might earn 70% of annual income in winter, but the DSCR uses the annual average. Ensure your average monthly income covers PITIA year-round.

Do I need an STR permit before applying for the loan?

Not always, but you must prove the property is in an STR-legal area. Some lenders require permits at closing, others allow 30-60 days post-closing. Always verify local regulations first—loan approval doesn't guarantee STR legality.

Can I include furniture costs in my DSCR loan?

Some lenders allow up to $50,000 for furniture and setup costs to be included in the loan. This is especially helpful for new STRs. The furniture budget is added to the purchase price for loan calculations, so ensure the total DSCR still works.

What happens if STR regulations change after I close?

Your DSCR loan remains valid regardless of regulation changes. However, if STRs become prohibited, you'd need to convert to long-term rental. Always have a backup plan and ensure the property works as a traditional rental too.

Do property management fees affect the DSCR calculation?

No, DSCR only includes PITIA (Principal, Interest, Taxes, Insurance, HOA). Management fees, cleaning, utilities, and other operating expenses aren't included. However, smart investors factor these into their cash flow analysis—typically 25-35% of gross revenue for STRs.