The Quick Read: A never-listed property can still qualify on short-term rental income because a projection report estimates revenue from comparable nearby listings, not from the subject property’s own bookings. The steps are simple: confirm what the lender will accept, order an address-level report with exact property details, then review and adjust the comp set before it goes into the file.
- The report estimates annual revenue, average daily rate, occupancy, and seasonality from comparable listings.
- It is a purchase tool. Refinances generally call for about 12 months of actual hosting history.
- Short-term rental purchases typically reach 75% LTV on the strongest files, with a 640+ score and a 1.00 coverage floor.
- Weak comps, thin markets, and gross-versus-net confusion are where projections go wrong.
- A strong projection does not make a property legal to operate as a short-term rental.
A first-time host buying in an unfamiliar market has no lease and no bookings. The lender still needs a defensible income figure. The projection report fills that gap, and how well it is built decides how much income the file can carry. Lendmire’s complete DSCR loans guide covers the broader loan mechanics. This piece covers the report itself.
What Is an STR Projection Report?
It is a comp-based revenue estimate for one specific address. AirDNA’s Rentalizer, the best-known tool, estimates revenue, average daily rate, and occupancy from real comparable listings nearby. It weights those listings by relevance, so more similar properties count for more, and it adjusts for seasonality and demand.
| Field | What it means | Why underwriters care |
|---|---|---|
| Projected annual revenue | Estimated gross bookings | Starting point for qualifying income |
| Average daily rate (ADR) | Typical nightly price | Drives revenue |
| Occupancy | Share of nights booked | Tests whether ADR is realistic |
| Monthly forecast | Seasonal revenue curve | Shows income concentration |
| Comp strength | Consistency across comps | Signals how much to trust the number |
The vendor’s comp-strength score measures how consistent revenue is across the comps behind the projection. Custom comps can raise it. That is a useful number to look at before anything else.
Why Does “No History” Not Block the Report?
The model never looks at the subject property’s bookings. It looks at neighbors. That is why a property that has never been listed can still produce a number.
Three situations get lumped together here, and they behave differently:
- New owner, established market. Dense comps, usually a reliable projection.
- New market for an experienced host. Your hosting record helps the file, but the comps still decide the revenue figure.
- Thin or rural market. Few comparable listings. This is where the number gets shaky.
Across the wholesale network, short-term rental purchases typically look for about 12 months of landlord or host experience from the borrower, alongside the projection. That is the experience tier, and it is separate from the property’s own history.
How Do You Get the Report, Step by Step?
Order matters. Most mistakes happen before the report is even run.
1. Confirm acceptance first. Ask your loan broker which report type, date range, and comp parameters the lender wants. Programs differ, and a report the lender will not use is wasted money.
2. Pick a source. Tools differ in method. Some build from listing data, others from booking data. Lender acceptance should drive the choice.
3. Enter exact property details. Use the full address, bedrooms, bathrooms, and guest capacity. RentalRecon, an operator blog, notes that these details determine which comps get used, and that a zip code or neighborhood name produces a wider, less accurate comp set.
4. Review the comps. AirDNA’s analyzer lets you filter by proximity or amenities and swap comps manually, and the revenue estimate updates. A beach house with a pool should not be compared with inland homes in the same zip code.
5. Export the report for the loan file, and check that its date will still be fresh when the lender reviews it.
What If the Market Has Few Comparable Listings?
Widen the search with discipline, not hope. Thin data is the most common weak spot for a buyer with no local footprint.
An operator review at 10xbnb says that in markets with fewer than 100 listings, projections can drift 15 to 30 percent in either direction. It is anecdotal, not authoritative, but the direction of the warning is sound: sparse comps mean extrapolation, not measurement.
A practical test for widening the comp set:
- Match bedroom count, guest capacity, and property type before distance.
- Match the demand driver. A lake cabin belongs with lake cabins, not with in-town homes.
- Match amenity tier. A hot tub and a pool move rates.
- Stop widening when the comps no longer share your guest profile. At that point the honest answer is that the data is too thin, and a low-leverage structure or an appraiser’s analysis may serve better than a stretched projection.
Report vs. Appraiser STR Analysis
The standard rent appraisal form cannot do this job. Fannie Mae’s appraiser guidance says the 1007 was not designed for single-family properties used as short-term rentals and cannot be used to estimate a nightly fee. It also calls multiplying a nightly rate by 30 incorrect for that form. (This is agency material, cited only for the form. It does not govern DSCR programs.)
| Factor | Projection report | Appraiser STR analysis |
|---|---|---|
| Purpose | Revenue estimate from comps | Income narrative tied to the appraisal |
| Who orders it | Investor or broker | Lender, through the appraisal |
| Typical contents | Revenue, ADR, occupancy, seasonality | Occupancy, seasonal pricing, comps, expenses |
| Best for | Purchases with no history | Supporting or cross-checking the report |
HousingWire reports that experienced STR appraisers use a narrative addendum built on occupancy, seasonal pricing, comparable performance, and expense assumptions. Many files carry both documents. When they disagree widely, that gap is worth understanding before the lender finds it.
How Does the Report Become Qualifying Income?
Underwriting does not drop the raw figure straight into the ratio. Across the wholesale network, lenders typically apply their own adjustment to the projection, and those adjustments differ from one program to the next. Think of it as a step sequence:
1. The report produces projected gross revenue.
2. The lender applies its own discount or factor.
3. The adjusted figure is divided by the full monthly housing obligation: principal, interest, taxes, insurance, and any HOA dues.
4. The result is the coverage ratio.
On short-term rental purchases, select programs in the network start at a 1.00 coverage floor, and leverage typically reaches 75% LTV on the strongest files with a 640+ score. Stronger ratios can improve pricing and leverage. Some select lenders also review coverage below 1.00, with leverage and terms adjusted. Reserves commonly run around six months of PITIA but vary by lender, leverage, and loan size.
One practitioner note: files built on projections tend to turn on the first-year income assumption. The strongest ones run the report, run an independent comp check, and arrive with both numbers already reconciled.
Clearing 1.00 is not the same as positive cash flow. Coverage compares rent to the housing payment only. Cleaning, management, utilities, supplies, vacancy, and repairs sit outside it, and short-term rentals carry more of those costs than long-term rentals do.
Gross Revenue Is Not Net Income
Investors regularly misread the output. A BiggerPockets forum poster warns that the vendor’s revenue includes occupancy taxes, cleaning fees, and pet fees passed through the platform. That is an investor anecdote, not a rule, but it points at a real habit: treat the report as gross revenue and do your own expense math. BiggerPockets’ analysis guide gives the underlying formula: occupancy rate times calendar days in the month times average daily rate gives estimated monthly income.
If the Projection Comes In Low
A low number is information, not a verdict. Work through it in order:
1. Recheck inputs. A wrong bedroom or guest count changes the comps.
2. Review the comp set. Remove mismatched comps and add true ones.
3. Add the appraiser’s STR analysis as a second basis.
4. Adjust the structure. More down payment lowers the payment and can lift the ratio, though it never erases leverage caps, credit floors, or reserve rules.
5. Reconsider the property. If no reasonable comp set supports the price, the issue is the purchase, not the paperwork.
Underwriting can also revert to long-term market rent if short-term income is not accepted. That usually understates a good STR.
Checks the Report Cannot Make
A projection says nothing about whether the property can legally operate as a rental of this kind. Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income. Confirm permitting before ordering anything.
Other common mistakes:
- Using a market average instead of an address-level report.
- Entering the wrong guest capacity or amenity tier.
- Submitting a stale report.
- Assuming the lender will use 100% of the projection.
- Assuming a strong projection means approval. Appraised value, credit, and the borrower profile still apply.
Properties such as manufactured homes, log homes, and barndominiums are not offered through the network’s DSCR programs, however strong the projection.
Pre-Order Checklist
- Lender acceptance of the report type confirmed.
- Exact address, bedrooms, bathrooms, and capacity entered.
- Comp set reviewed and edited for amenity tier.
- Comp-strength signal checked.
- Report date confirmed as fresh.
- Independent comp check against live listings and calendars.
- Local permit, zoning, and HOA rules confirmed.
- Gross-to-net expense math done separately.
Key Terms Defined
ADR (average daily rate): The average nightly price booked across a period.
Occupancy: The share of available nights that are booked.
Seasonality: The pattern of revenue rising and falling through the year.
Comp set: The group of nearby listings used to estimate a property’s income.
Comp strength: A measure of how consistent revenue is across the comps behind a projection.
Form 1007: An appraisal form that documents monthly market rent, not nightly rates.
Frequently Asked Questions
Can I qualify for a short-term rental DSCR loan with no history?
Yes, on purchases. A projection report or appraiser analysis supports income when the property has no bookings. Lenders typically also want about 12 months of host experience from the borrower. Refinances generally call for actual hosting history instead. Details depend on lender guidelines and the file.
Will a lender accept any projection report?
Not necessarily. Each lender sets its own rules for the report. Most want an address-level report built from comparable listings that match the property’s bedrooms, capacity, and property type. Most also want a recent date, a forward 12-month forecast, and a comp set strong enough to show consistent revenue. Many apply their own discount to the figure, and the lender decides which report counts. Ask your broker what a specific program accepts before you pay for one.
What if there are few comparable listings nearby?
Match bedrooms, capacity, and property type first, then widen distance carefully. If comps still look thin, an appraiser’s analysis or lower leverage can serve the file better than a stretched estimate.
Is the projection what I will actually earn?
No. Run your own expense math and check live listings.
Does the projection work for a cash-out refinance?
Usually not alone. Short-term rental refinances sit around 70% LTV on short-term-rental collateral, with about 12 months of hosting history expected.
Tax treatment can depend on how the funds are used and how the property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
If you are buying or refinancing a rental property and want to see how the numbers work, Lendmire can help you compare DSCR loan options based on the property income, credit profile, leverage, and investor goals. Programs are arranged through select lenders in a 41-market wholesale network, including Washington, D.C., subject to lender guidelines and not a commitment to lend.
About Lendmire
Lendmire (NMLS# 2371349), a non-QM mortgage broker serving investors in 41 markets including Washington, D.C., helps structure DSCR scenarios commonly evaluated around a property’s rental income rather than personal income paperwork, subject to lender guidelines. A Scotsman Guide Top Mortgage Workplace in 2025 and 2026, Lendmire places loans through wholesale investor lenders and is not a direct lender.
Investors focused on short-term rentals can review DSCR loans for Airbnb and short-term rentals.
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References
2. RentalRecon, an operator blog
5. Fannie Mae Appraiser Update
6. HousingWire: Short-term rentals and the appraisal playbook
7. A BiggerPockets forum poster
8. BiggerPockets: Analyze a short-term rental
This article is part of Lendmire’s short-term rental loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Projected vs History Income for a DSCR Loan on a New-Build STR · How to Get an STR Projection Report a DSCR Underwriter Accepts · How to Finance a First Airbnb With No Rental History
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.