Rental / DSCR in Oakland

They do not come with the building. Oakland allows an owner to bank deferred CPI rent increases and apply them later, but as of 2026-01-01 the city prohibits transferring banked increases to a new property owner, outside a narrow carve-out for transfers by inheritance between spouses or between parents and siblings, children, or stepchildren, and only if the transferee holds the property at least one year. Banking itself is now capped at five years, down from ten, and a banked increase can never exceed three times the current year's CPI. If a seller's pro forma shows a plan to "catch up" a decade of deferred increases after you close, that plan is not executable under an ordinary purchase. Confirm what, if anything, is actually banked and transferable on a specific unit before you underwrite the rent roll, and read what a covered unit's allowable increase looks like going forward in the next question. Run the numbers with the DSCR calculator.

Two separate city charges on top of your operating expenses. Oakland's landlord business tax runs $13.95 per $1,000 of annual gross rental income, 1.395 percent, due at registration within 30 days of first renting and renewed each March 1. Residential landlords also pay a Rent Adjustment Program fee of $137 per unit per year, due January 1, of which half may be passed through to the tenant if paid on time. On a house renting at Oakland's July 2026 rent index of $2,691 a month, that is roughly $450 in business tax plus about $69 net RAP fee, just over 1.6 percent of gross rent a year before any other expense. An owner delinquent on the business tax also loses the right to raise rent or serve a no-fault eviction notice until current. Those per-unit fees add up fast across a multi-door hold, which is why many owners roll several Oakland rentals into one Oakland portfolio loan instead of financing each separately. Build both fee lines into your DSCR calculation. Run your numbers with the DSCR calculator.

Check the certificate of occupancy date first, because there is no blanket exemption for a single-family house. Oakland's Rent Adjustment Ordinance exempts units that received a certificate of occupancy on or after January 1, 1983, and were newly built or converted entirely from nonresidential space, plus government-subsidized units and a short list of institutional uses. There is no single-family or condominium carve-out in that list. Costa-Hawkins removes single-family homes and condos from the rent cap itself, not from Oakland's separate just cause eviction ordinance, which has no property-type exemption at all. A covered unit that is not registered in the rent registry cannot get a rent increase approved. Confirm the certificate of occupancy date on any Oakland property before you underwrite market rent growth. Talk to your attorney about how a specific building is classified.

Oakland collects tax on short-term rentals but has no permit program to license one, and the city says so itself. Its own business tax page states that neither the Oakland Municipal Code nor the Planning Code "specifically address Short-Term Residential Rentals," with the last public step toward a policy dated 2017. Transient occupancy tax still applies at 14 percent of rent on any stay of 30 days or less, and landlords renting short-term must register and pay the same landlord business tax, with Airbnb named specifically in the ordinance. Whether Oakland's zoning code separately treats a short-term rental as a non-permitted use in a residential zone was not confirmed. Underwrite an Oakland DSCR loan on long-term rent, not a nightly-stay projection, until that regulatory picture is settled.

Slower than the sticker rate suggests. Oakland's allowable annual increase for 2026-27 is 2.3 percent, set each August 1 at 60 percent of CPI, capped at 3 percent. You get one increase per 12 months, the first cannot take effect before 12 months after move-in, and no increase can take effect until at least six months after the tenant was served the required RAP notice. An unregistered covered unit cannot get an increase approved at all, and any increase notice must include a copy of that RAP notice. If every tenant in the unit is new, Costa-Hawkins lets you set market rent at turnover; if any original tenant remains, the ordinance still governs. Underwrite rent growth on the capped schedule, not the market rate, for any occupied covered unit you acquire.

20% down from you, at a minimum. The program funds up to 80% LTV, so on a $700,000 Oakland purchase that is up to $560,000 from us and $140,000 from you (700,000 x 80% = 560,000), before closing costs. Loan amounts run $100,000 to $3M, and coverage starts at a DSCR of 0.75. Put Oakland's landlord business tax of $13.95 per $1,000 of gross rent and the $137 per unit Rent Adjustment Program fee into the rent side before you test coverage, because both come off gross rent every year. Subject to underwriting.

Not on this program. DSCR starts at a 640 credit score. Under 640, the asset-based side is where Oakland deals still get done: fix and flip, bridge and ground-up construction carry no minimum score, weight credit far less than a bank does, and usually offset weaker credit with lower leverage rather than a decline. There is no hard credit pull to start, so it costs nothing to find out which side of the line your file sits on. Subject to underwriting.

Prepay is a structure you pick up front, not one fixed rule. This program offers flexible prepayment structures, so a hold you expect to sell inside a couple of years gets priced differently from a 30-year fixed you intend to keep, and the 5, 7 and 10-year ARM options sit between them. Tell us the exit before we structure the loan rather than after. One Oakland-specific reason holds run longer than owners first plan: the allowable annual increase on a covered unit is 2.3 percent for 2026-27, so rent catches up to market slowly here. Subject to underwriting.