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Massachusetts market guide
DSCR loans in Cambridge, MA
Rental financing for Cambridge investors, qualified on the property's rent.
For Cambridge, MA rentals, the DSCR test compares rent to the full payment. The Census medians that frame it are $2,787 rent, $1,092,100 value and $4,802 in yearly taxes.
Local data for Cambridge investors
Start with the two numbers every DSCR file turns on. Rent in Cambridge runs a median $2,787 a month (well above the Massachusetts median of $1,762), and the median owner-occupied home is worth $1,092,100. A quick screen: twelve months of Cambridge median rent over its median home value equals 3.1%, a lean ratio that leaves little room for taxes, insurance and dues. Use it to compare markets, then replace it with real rent evidence for the address.
| Indicator | Massachusetts | Cambridge | Difference |
|---|---|---|---|
| Persons per household | 2.44 | 2.05 | |
| Share in 2-4 unit buildings | 20.0% | 29.1% | +45% |
| Share of homes detached | 51.1% | 9.9% | -81% |
| Degree holders, age 25+ | 47.3% | 80.8% | +71% |
| Workers on their own account | 8.8% | 6.0% | -31% |
| Units sitting vacant | 8.1% | 9.8% | +22% |
| Typical construction year | 1964 | 1950 | |
| Annual rent divided by value | 3.8% | 3.1% | -19% |
| Households that rent | 37.5% | 66.5% | +78% |
| Tax as a share of home value | 1.07% | 0.44% | -59% |
| Annual property tax bill, median | $5,992 | $4,802 | -20% |
| Household income, median | $103,960 | $130,748 | +26% |
| Typical owner-occupied value | $562,100 | $1,092,100 | +94% |
| Typical monthly rent | $1,762 | $2,787 | +58% |
| Residents (Census estimate) | 7,044,056 | 118,796 |
A renter-heavy city, Cambridge has 66.5% of households renting (well above the Massachusetts median of 37%), which is good for demand and a reminder to check rent comparables carefully. The median household brings in $130,748 (well above the Massachusetts median of $103,960), with 45% of renters paying 30 percent or more of income toward rent.
Housing stock and vacancy in Cambridge
Cambridge has a deep multifamily layer: roughly 84% of units sit in buildings of two or more, with 29% in duplexes through fourplexes. With a median build year of 1950, older roofs, plumbing and electrical are the norm and inspection findings drive the numbers.
Vacancy is a quiet driver of rent. 10% of homes are vacant citywide and 4.6% of the rental inventory was listed for rent when the Census surveyed.
Underwriting angles in Cambridge
At 3.1% gross, Cambridge is a tight market for DSCR math, and investors often turn to interest-only structures, higher rents on renovated units or small multifamily to make the ratio clear. With homes this old, a pre-offer inspection is not optional in Cambridge. Renter-heavy markets like Cambridge favor investors with a clear tenant profile, whether workers, students or families.
Carrying costs in Cambridge
Tax drag is easy to underestimate. Cambridge owners report a median $4,802 in annual real estate taxes, about 20% below the Massachusetts median of $5,992, an effective 0.44% of median home value. Measured against a year of median rent, taxes eat about 14% before any other cost shows up.
FEMA's National Risk Index (version 1.20, December 2025) rates Middlesex County as relatively high overall for natural hazard risk, with ice storms (very high), riverine flooding (relatively high) and lightning (relatively high) among its leading hazards.
| Hazard in Middlesex County, FEMA index | Level |
|---|---|
| Hurricanes exposure | Relatively High |
| Lightning exposure | Relatively High |
| Riverine flooding exposure | Relatively High |
| Ice storms exposure | Very High |
| Social vulnerability score | Very Low |
| Annualized loss estimate | Relatively High |
| Composite risk | Relatively High |
Insurance belongs in the ratio from day one, so get a landlord quote for the Cambridge address and ask about roof age, wind or hail deductibles and flood cover.
A worked DSCR test for Cambridge
At the city medians a DSCR file in Cambridge has $2,387 a month after taxes to cover principal, interest, insurance and dues if the ratio is 1.00, or $1,829 if the ratio is 1.25. Those two numbers show why insurance quotes and tax estimates come first.
Legal checks before a Cambridge purchase
Rental registration, inspection and nightly-stay rules differ by city, and we have not verified Cambridge's from a municipal source. A short call to the city and Middlesex County before you make an offer is cheap insurance. For Cambridge short-term hosts, one state-level point stands out. Massachusetts has required short-term rental operators to register with the Department of Revenue since July 1, 2019, and applies the room occupancy excise to rentals of 31 days or less, with local taxes and fees added where a city or town has adopted them.
A Cambridge landlord must handle the deposit within 30 days after move-out under Massachusetts law. Massachusetts rent regulation summary: Rent control is prohibited statewide by the Massachusetts Rent Control Prohibition Act (c. 40P), which bars rent-control schemes except voluntary ones.
Comparing Cambridge with surrounding markets
Prices in the comparison range from $618,500 in Quincy to $911,300 in Somerville, with Cambridge at $1,092,100.
| Market | Renter share | Tax bill | Home value | Residents | Rent |
|---|---|---|---|---|---|
| Quincy | 55% | $6,381 | $618,500 | 102,114 | $2,118 |
| Boston | 64% | $4,456 | $731,700 | 666,442 | $2,147 |
| Malden | 59% | $4,995 | $633,500 | 65,906 | $2,204 |
| Somerville | 66% | $6,186 | $911,300 | 81,036 | $2,517 |
| Cambridge | 67% | $4,802 | $1,092,100 | 118,796 | $2,787 |
The renter base in Cambridge
6.0% of employed residents work for themselves, which matters here because DSCR lending does not ask for tax returns or pay stubs. On the workforce side, government workers are about 9% of employment, 81% of adults hold a bachelor's degree or higher and 13% of commuters travel 45 minutes or more.
For a sense of who employs Cambridge renters, the published employer list for 2024 shows Harvard University, Massachusetts Institute of Technology, Cambridge Innovation Center, City of Cambridge and Takeda Pharmaceuticals. Check the current year before you lean on it, since payrolls move. Campuses such as Massachusetts Institute of Technology, Harvard University, Lesley University and Longy School of Music of Bard College pull tenants into Cambridge, and landlords near them can plan around move-in seasons. On the logistics side, air service through Logan International Airport are noted for Cambridge.
Before you make an offer in Cambridge
Run the Cambridge rent, tax and insurance figures through the DSCR calculator. When they clear the ratio, start an application or ask for a quote.
More Massachusetts markets
- All Massachusetts DSCR loans
- DSCR loans in Somerville, MA
- DSCR loans in Malden, MA
- DSCR loans in Boston, MA
- DSCR loans in Quincy, MA
- Every market we cover
References
- M.G.L. c. 186, § 15B(1)(b), (1)(d), (2), (3), (4), (5), the Massachusetts deposit law
- For nightly stays in Cambridge: Mass.gov TIR 19-3
- For nightly stays in Cambridge: Room occupancy excise
- Census Bureau ACS 5-year 2020 to 2024 tables
- FEMA National Risk Index
- Background reading: Cambridge, Massachusetts
All Cambridge statistics are ACS five-year survey estimates from 2020 to 2024. Landlord rules for Cambridge rest on Massachusetts statutes and the CC BY 4.0 RedFlagLease dataset. Verified October 2026. Ordinances and statutes change, so confirm before acting.
Before you make an offer
On a Cambridge purchase, line up the lease, the tax estimate, the insurance quote and any association dues before the appraisal is ordered, and ask the appraiser's office what rent comparables they plan to use.
DSCR loan availability varies by property and lender program and is not an offer to lend. See our disclosures.
Frequently asked questions
How does a lender pick the rent for a Cambridge DSCR file?
Underwriters take the lease if one exists and compare it with the appraisal's rent estimate; the lower figure often governs. Cambridge median rent is $2,787.
Does the ratio in Cambridge include taxes and dues?
Yes, the payment includes principal, interest, taxes, insurance and association dues. At the Cambridge median rent of $2,787, a 1.25 ratio allows about $2,230 in total payment, of which roughly $400 a month goes to median taxes.
How high are property taxes in Cambridge?
Median taxes paid are $4,802 a year, or 0.44% of median value, compared with 1.07% statewide. Ask Middlesex County's tax office what the bill becomes after your sale.
Will a lender count nightly rental income at a Cambridge property?
Yes on programs built for it, once the use is lawful in Cambridge. Gather twelve months of statements or a third-party projection, and have Massachusetts tax registration squared away.
Are there deposit limits for Cambridge rentals?
Start with M.G.L. c. 186, § 15B(1)(b), (1)(d), (2), (3), (4), (5). Return window: 30 days. Talk to a Massachusetts attorney for a lease form that matches.
How exposed is Cambridge to natural hazards?
The National Risk Index gives the county an overall relatively high rating. Use that as a prompt to get quotes, not as a verdict on one Cambridge street.
How do LLC closings work for Cambridge rentals?
It is optional. Lenders will close in a properly formed LLC and generally want the members to guarantee. Ask your accountant how a MA entity would be taxed.