Debt-Service Coverage Ratio (DSCR)
What is DSCR?
Section titled “What is DSCR?”The Debt-Service Coverage Ratio measures how comfortably a rental property’s operating income covers its mortgage payments:
DSCR = Net Operating Income (NOI) / Total Debt Service- Net Operating Income (NOI) — effective rental income minus operating expenses (rates, insurance, management fees, maintenance, and similar), before the mortgage payment.
- Total Debt Service — the annual mortgage payment (principal + interest) for the property, or for the whole portfolio when shown on the Dashboard.
Where you’ll see it
Section titled “Where you’ll see it”- Dashboard — a portfolio-wide DSCR combining every owned property’s NOI and debt service.
- Property → Cashflow tab — a DSCR just for that one property, using its current-year figures.
A property or portfolio with no mortgage shows “no debt” / “no mortgage” instead of a ratio — DSCR isn’t meaningful without debt to service.
What’s a good DSCR?
Section titled “What’s a good DSCR?”| DSCR | What it means |
|---|---|
| Less than 1 | The property isn’t generating enough NOI to cover its mortgage payments — you’d need to top it up from other income. |
| Equal to 1 | Operating income covers debt payments, but just barely — no income left over, and no cushion for a vacancy or an unexpected expense. |
| Greater than 1 | The higher the number, the more comfortably NOI covers debt service. Many lenders look for at least 1.20–1.25x on investment lending. |
A property’s DSCR moves over time as rent, expenses, or the mortgage payment (e.g. after a rate change or extra repayments) change — it’s worth checking again whenever any of those shift materially.