Short-Term Rental Financing in Telluride, CO

Short-Term Rental investing in Telluride

Short-term rental financing in Telluride is a different underwriting product than a long-term DSCR loan even though it carries the same name. The lender is crediting nightly revenue instead of a signed lease, which means the documentation, the reserve requirement, and the permit diligence all change.

At the Telluride median of $2,400,000, a short-term rental prices near $2,400,000. Minimum down is 25% ($600,000), leaving a loan of $1,800,000. Estimated all-in PITIA runs about $14,539 per month.

Returns and structure

Return metrics at the Telluride median for this product: an estimated cap rate of 2.59%, and monthly cash flow of $5,107 negative at 25% down. Negative cash flow at the minimum down payment is common in appreciation-led markets; investors close the gap with a larger down payment, a purchase below median, an added unit, or a rate buydown. Note that the $1,800,000 loan amount exceeds the $994,750 conforming limit for San Miguel County, so agency pricing is off the table and this is a jumbo DSCR file.