"Still, some lenders just love their numbers, huh?"
Haha, tell me about it... ever had a lender pull out a spreadsheet mid-meeting? Happened to me once—felt like I was back in math class. But seriously, comps upfront are a great idea. Have you found certain types of comps resonate better with lenders? I've noticed recent sales data usually does the trick, but sometimes rental trends or vacancy rates seem to carry more weight. Curious what's worked best for you.
Had a lender once who barely glanced at recent sales but got laser-focused on vacancy rates and market absorption—said it showed "real-world demand." Ever since, I always keep those numbers handy... just in case.
Vacancy rates definitely tell a story, but I've had markets where absorption looked fantastic on paper yet rents stayed flat. Ever run into that disconnect—strong absorption numbers but no real rent growth?
I've definitely seen that happen—strong absorption numbers looking great on paper, but rents just kinda... sit there. It's like the market's giving mixed signals. One thing I've noticed is that absorption alone doesn't always tell the full story. Sometimes there's hidden inventory or shadow supply that's not fully accounted for, or maybe landlords are offering concessions behind the scenes to keep occupancy high.
When qualifying for a DSCR loan, lenders are usually cautious about relying solely on vacancy and absorption data. They'll dig deeper into actual rent rolls, lease terms, and even local economic factors. My advice: don't get too excited by absorption alone. Take a step back, look at the bigger picture—like employment trends, new construction permits, and even tenant quality. It might seem tedious, but trust me, it's better than getting blindsided later.
Had a client once who jumped in based purely on absorption stats and ended up stuck with flat rents for years. Not fun when you're trying to meet DSCR requirements...
"Sometimes there's hidden inventory or shadow supply that's not fully accounted for, or maybe landlords are offering concessions behind the scenes to keep occupancy high."
This is a really good point—makes me wonder how often these concessions actually skew the data. Do lenders typically catch onto these behind-the-scenes deals easily, or is it something borrowers need to proactively disclose? Seems like there's always another layer to peel back... appreciate you sharing your client's experience; definitely gives me something extra to think about.
