Bakersfield has a deep supply of small multi-unit rentals by California standards: 1960s to 1980s fourplexes built in rows along neighborhood streets, older duplexes downtown and in East Bakersfield, and a growing number of homes with added accessory units. Prices are a fraction of coastal California, which lets rent carry the loan.
In short: LendingStreet finances Bakersfield duplexes, triplexes and fourplexes with DSCR loans that qualify on the combined rent of all units, with no W-2s or tax returns and LLC borrowers allowed. Loans start at $150,000 with no stated maximum, purchases go up to 80% LTV, cash-out up to 75% and the standard minimum DSCR is 1.0x. Many Bakersfield fourplexes clear 1.0x at 75% LTV, which is rare in California.
Rows of two-story fourplexes from the 1960s to the 1980s line streets in southwest and central Bakersfield, near Ming Avenue, California Avenue, Stockdale Highway and around Cal State Bakersfield. Older duplexes and converted homes are common in downtown, Oleander-Sunset, Westchester and East Bakersfield. Northeast Bakersfield and Oildale also have duplexes and small buildings at lower prices.
Many fourplexes were built in groups by the same developer, which makes comparable sales and rents easier for appraisers to find.
Many of these buildings have been owned by the same families for decades, so they often come with long-term tenants and rents below market. That can mean a smaller loan at purchase and a stronger refinance later as leases turn over within the limits of state law.
Because so many buildings share a floor plan, buyers can compare operating costs and rents across a block before making an offer. Ask neighboring owners or local property managers what similar units lease for and how long they sit vacant.
Tenants include hospital workers, teachers, oil and agriculture employees, Cal State Bakersfield and Bakersfield College students, and families who want a lower rent than a single-family home. Two-bedroom units with covered parking, updated kitchens and working central air lease fastest. In a valley where summer temperatures regularly top 100 degrees, a weak air conditioning system can keep a unit empty.
Lenders typically use the lower of actual leases and market rent for each unit, so get a unit-by-unit rent schedule.
Rent levels differ more by condition than by street. A fully updated fourplex near Cal State Bakersfield may rent for a few hundred dollars more per unit than a dated building a mile away. Appraisers will compare your units with similar ones, so photos and a list of upgrades help.
California law now allows accessory dwelling units on most residential lots and, under SB 9, lets many single-family lots be split or developed with a second home. In Bakersfield, those changes have produced homes with a backyard unit and some new duplexes.
For financing, every unit must be permitted and finaled. An unpermitted garage conversion may not count as a rentable unit, and an appraiser may value the property without it. Ask the seller for permits and certificates of occupancy.
This example is illustrative and not a quote. An investor buys a 1970s fourplex in southwest Bakersfield for $640,000. Each two-bedroom unit rents for $1,350, for $5,400 a month in total. Taxes, reassessed at the purchase price under Proposition 13, are $613 a month and insurance is $280.
At 75% LTV the loan is $480,000. Estimated principal and interest on a 30-year term is about $3,274, so the total payment is about $4,167. DSCR is about 1.30x. Water, trash and landscaping, if the owner pays them, are not part of the ratio but come out of your cash flow.
| Item | Southwest Bakersfield fourplex |
|---|---|
| Purchase price | $640,000 |
| Loan at 75% LTV | $480,000 |
| Estimated principal and interest | $3,274 |
| Taxes | $613 |
| Insurance | $280 |
| Total monthly payment | $4,167 |
| Combined rent (4 units) | $5,400 |
| DSCR | 1.30x |
California's Tenant Protection Act caps annual rent increases and requires just cause for many evictions on covered rentals. Buildings with two or more units are generally covered once they are more than 15 years old, unless another exemption applies. That includes most of Bakersfield's fourplex stock.
The loan is sized on current and market rent, so the cap does not change the qualifying math, but it can limit how quickly you raise below-market rents after you buy. If the current leases are well under market, plan for a slower climb.
Kern County reassesses the property at your purchase price, with a base rate of about 1% plus local bonds and assessments. Some areas carry special district charges on the bill. California closings typically use an escrow company and a title company, and Kern County charges a documentary transfer tax on the deed; some California cities add their own transfer tax, so confirm the full amount with escrow.
Ask for the full tax bill estimate before you finalize your numbers.
California also asks buyers to review natural hazard disclosures, which flag flood, fire and earthquake fault zones. Bakersfield sits in an active seismic region, and while earthquake insurance is usually optional, it is worth pricing on an older two-story building.
Bakersfield's 1960s to 1980s buildings have predictable issues.
Five to eight unit buildings are still residential for our DSCR programs, with max LTV that can vary by program; see /dscr-loans-5-8-units-bakersfield-ca.html. If you own five or more rentals, a blanket loan can combine them. Nine or more units is commercial lending.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the address, price, rent roll and any permits for added units, and we will run the ratio on actual and market rent. Call (877) 298-1001 or use the form below.
Many do, because rents are strong relative to prices. Every building is different, so run the numbers on the actual rent roll.
If it is permitted and finaled, yes. An unpermitted conversion may not count.
Most buildings with two or more units that are over 15 years old are covered unless another exemption applies. Ask a California landlord attorney.
No. These loans are for investment property only.
The program minimum is 620.
Tenants usually pay electricity and gas, while the owner often pays water, sewer and trash on a single meter. Those owner costs are not in the ratio but affect your cash flow.
Lenders usually use market rent from the appraisal.
Yes. Rate-and-term goes up to 80% LTV on some programs and cash-out up to 75%, and a refinance does not trigger Prop 13 reassessment.
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