Craftsman bungalow with a deep welcoming front porch in Madison, Wisconsin

Night-capped · 180/yr

Short-term rental laws in Madison, WI

Last updated 2026-06-02·Source: City of Madison STR License (MGO §9.A)

The current rules

What Madison actually requires

Madison requires an STR license and, for non-primary-residence properties, caps rentals at 180 nights per year as of its 2026 update.

The 180-night cap applies a moderate revenue haircut; Wisconsin’s high effective property tax then pressures the ratio further.

A recently-changed market — exactly the kind where dated, accurate guidance out-ranks stale evergreen pages.

Does it still pencil?

A $325,000 3BR at 25% down

Revenue cap-adjusted $38,000 → $27,360/yr.

0.94×cap-adjusted STR DSCR

Pencils — 2 STR lenders clear the floor at this ratio.

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FAQ

Madison STR-law questions

Is short-term rental legal in Madison?

Madison tightened its short-term-rental rules in 2026: a license is required, and non-primary-residence rentals are capped at 180 nights per year. Wisconsin’s high property tax compounds the cap’s DSCR impact. (Source: City of Madison STR License (MGO §9.A), as of 2026-06-02.) Always confirm current rules with the jurisdiction before purchasing.

How much does an Airbnb make in Madison?

A typical 3-bedroom projects around $38,000/yr from 12 comparable listings within 2 mi, trailing 12 months (AirROI + Rabbu comps). Revenue scales with bedroom count and amenities; lenders verify via Form 1007 or operating statements.

Does Madison’s 180-night cap kill my DSCR?

Not automatically, but it haircuts revenue. We scale projected revenue to the capped share of an uncapped year (180/250 nights) before computing DSCR. Sometimes it still clears a lender floor; sometimes a mid-term-rental pivot is the answer.

Will the rules in Madison change?

Likely — STR ordinances are moving city by city in 2026. This page was last checked 2026-06-02; we re-check on a monthly minimum and on ordinance events. Confirm the current rule with Madison before closing.

Can I get a DSCR loan on an Airbnb with no rental history?

Yes. 9 of the 10 STR lenders we track qualify the loan on a market revenue projection (AirDNA/Rabbu) or an appraiser’s Form 1007 short-term-rent schedule, so no operating history is required for many programs.

What DSCR do STR lenders require?

Most set a floor around 1.0 on the cap-adjusted DSCR (revenue ÷ PITIA). Some offer no-ratio or sub-1.0 STR programs at a premium for thinner deals. The engine shows your ratio against each lender’s specific floor.

How current is this information?

Revenue and rate figures render from the data layer with an “as of” date; STR legality is re-checked on a monthly minimum and on ordinance events, because stale legality is worse than none. Every status shows when it was last checked and a source to verify.

Madison feasibility All cities STR → MTR pivot

Legality: Short-term-rental rules change frequently and vary by city, county, and HOA. Legality shown reflects publicly available sources as of the date displayed; it is not legal advice or a permitting determination. Confirm current rules, permits, and HOA/condo restrictions with the local jurisdiction before purchasing.

Revenue: Projected revenue is an estimate from comparable listings and is not a forecast of your results. Lenders independently verify income, typically via appraisal (Form 1007/1008) or 12-month statements. This is not a loan decision or offer.

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