The short answer: Often yes. Many DSCR programs allow short-term rentals such as Airbnb and VRBO, but STR eligibility varies by investor — some programs qualify actual booking revenue, while others fall back to the appraiser's long-term market rent. Confirm STR eligibility with the program before making an offer, and check that local rules and the HOA actually permit short-term rentals.
How STR income is counted
- Actual revenue history — some programs use documented short-term rental income, typically averaged from booking statements or tax schedules.
- Long-term market rent fallback — other programs ignore the Airbnb revenue and qualify on the appraiser's 12-month market rent instead.
- Track record helps — an established listing with a documented revenue history is easier to underwrite than a property that has never hosted.
- Local rules come first — the lender expects the STR use to be legal: zoning, permits, and HOA approval all matter.
- Reserves still apply — STR income is seasonal and variable, so post-closing reserves carry extra weight with many programs.
A worked example
Illustrative example — not a quote or commitment to lend.
An investor buys a mountain cabin listed on Airbnb. Its booking statements show average gross revenue of $3,000 per month over the last year; the proposed PITI payment is $2,400.
If the program counts actual STR revenue, DSCR = $3,000 ÷ $2,400 = 1.25 — a comfortable fit. But if the program only counts the appraiser's long-term market rent of $1,800, the ratio drops to 0.75 and the same deal may not qualify. The program's income method is the whole ballgame.
Important exceptions
- Some investors exclude STRs entirely. Never assume STR eligibility — it is program-specific.
- HOA and city rules can kill the plan. A program may approve the loan while the HOA bans rentals under 30 days. Verify both.
- New listings without history are harder to qualify on projected STR income; many programs default to long-term market rent.
- Seasonality matters. Averaged revenue smooths the peaks and valleys; a single great month doesn't set the number.
STR vs. long-term rental DSCR
| Feature | Short-term rental | Long-term rental |
|---|---|---|
| Income basis | Varies: actual STR revenue or long-term market rent | Appraised market rent or lease |
| Program availability | Allowed by many, excluded by some | Broadly allowed |
| Extra verification | Local STR legality, HOA rules | Standard lease or rent schedule |
| Income stability | Seasonal and variable | Steady lease income |
Authoritative sources
Related NonQM Rates resources
- DSCR Investor Loans — program details
- Further reading: the full DSCR deep-dive on our blog
- Q&A: What DSCR ratio do lenders require?
- Q&A: Can I close a DSCR loan in an LLC?
- Best markets for Airbnb investing
Wondering if a DSCR loan fits your deal?
Check My Eligibility or call 949-241-9489
Please note: Guidelines vary by investor and are subject to change. Educational content only — not loan advice.
