Portland's peninsula is lined with two- and three-family wood-frame houses, many with stacked porches and clapboard siding, built a century or more ago for workers at the port and the railroads. They are the backbone of the city's rental housing, and they trade at prices that make the DSCR math tighter than in most of Maine.
In short: LendingStreet finances Portland-area duplexes, triplexes and fourplexes with DSCR loans that qualify on the combined rent of all units, with no W-2s or tax returns. Loans start at $150,000, purchases go up to 80% LTV, the standard minimum DSCR is 1.0x and LLC borrowers are standard. High prices on the peninsula and the city's rent stabilization rules mean many Portland 2-4 unit loans land at 70% to 75% LTV, while Westbrook and nearby towns often cash flow at higher leverage.
On Munjoy Hill, in the East End, East Bayside, Parkside and the West End, many houses were built or converted as two- and three-family homes, with one unit per floor. Libbytown, Back Cove and parts of Deering add more, and newer infill duplexes have appeared where zoning allows. Brick rowhouses and larger Victorian conversions round out the stock.
Westbrook, South Portland and Biddeford have similar older multifamily at lower prices. Buildings of five to eight units are covered on our Portland, Maine 5-8 unit page.
Maine passed a housing law in 2022 that requires towns to allow additional units on residential lots, including accessory dwelling units and, in many areas, two or more units per lot. Portland has updated its land use code over the same period. The details depend on the zone and on water, sewer and lot size.
For a purchase, confirm the legal unit count with the city's permitting and inspections office. An attic or basement apartment without permits typically does not count toward value or rent, and Portland requires every rental unit to be registered.
Portland's rent stabilization ordinance limits annual rent increases on many units and requires notice and registration. Some units and buildings are exempt, and the rules have been amended since voters adopted them. When you buy a building with long-term tenants at below-market rents, you may not be able to raise them quickly.
Because a DSCR loan qualifies on actual rent, the current leases are what count. If a building only works at rents you hope to reach in several years, the numbers will not support the loan today.
This example is illustrative and not a quote. An investor buys a two-family house in East Deering for $600,000, with two units at $2,050, or $4,100 a month. Taxes are budgeted at $680 a month and insurance at $220.
At 75% LTV the loan is $450,000, estimated principal and interest on a 30-year loan is about $3,131, the total payment is about $4,031 and DSCR about 1.02x, right at the edge. At 70% LTV the loan is $420,000, the payment about $3,822 and DSCR about 1.07x.
A Westbrook triplex bought for $585,000 with three units at $1,700 works more easily: a loan of $438,750 at 75% LTV, a total payment near $3,953 and DSCR about 1.29x.
| Item | East Deering at 75% | East Deering at 70% | Westbrook triplex at 75% |
|---|---|---|---|
| Loan amount | $450,000 | $420,000 | $438,750 |
| Combined monthly rent | $4,100 | $4,100 | $5,100 |
| Estimated principal and interest | $3,131 | $2,922 | $3,053 |
| Taxes and insurance | $900 | $900 | $900 |
| Total monthly payment | $4,031 | $3,822 | $3,953 |
| DSCR | About 1.02x | About 1.07x | About 1.29x |
Tenants include Maine Medical Center and other hospital staff, University of Southern Maine and Maine College of Art students and faculty, restaurant and hospitality workers, and professionals who moved to the area for its quality of life. Demand for rentals on the peninsula has been strong, and vacancy has generally been low.
Use signed leases or an appraiser's rent schedule for the specific building. Rents vary with heat included, parking, laundry and outdoor space. Off-street parking is scarce on Munjoy Hill and in the West End, and units that include a space often rent faster.
Older Portland buildings often run on oil or gas boilers, and many owners have added heat pumps. Whether heat is included in rent changes your operating costs a lot. Insurance on 100-year-old wood-frame multifamily can be costly, especially with older wiring or chimneys.
Maine's lead poisoning prevention rules apply to many older rentals. Keep records of lead-safe work and other upgrades.
Portland's property tax rate is set by the city, and a recent revaluation shifted many bills. Westbrook, South Portland and Biddeford have their own rates. Maine's real estate transfer tax is split between buyer and seller.
Use the current tax bill and confirm whether a revaluation is coming. On a two-family where taxes run several hundred dollars a month, even a modest change can move the ratio, as the East Deering example shows. Factor in closing costs, inspection and any immediate repairs when you calculate cash to close.
Rate-and-term refinances go up to 80% LTV on some programs and cash-out refinances up to 75% LTV. Seasoning rules vary by program, and the combined rent must clear the minimum at the new payment.
Owners who bought Portland two-families a decade ago often have substantial equity and can use cash-out to buy in Westbrook, Biddeford or Lewiston, where rents go further. Just remember the new, larger payment still has to be covered by current rents, which rent stabilization may keep below market.
Send the address, price or value, unit count, leases, rent registration details, tax bill and insurance quote. The financing team will run the ratio at a few loan amounts.
Our investor loans are business-purpose loans on non-owner-occupied property. Call (877) 298-1001 or use the form below to get a quote.
Yes. The loan qualifies on the combined rent of both units, with purchases up to 80% LTV and a 1.0x standard minimum DSCR.
Peninsula prices are high relative to rents, so the payment at 80% often outruns the rent. Many files land at 70% to 75%.
The loan uses current rent from leases. Rent limits affect how fast you can raise below-market rents later.
The 2022 law requires towns to allow more units in many areas. Confirm what Portland allows on your lot before counting new units.
Portland requires rental units to be registered with the city each year.
Yes, as residential DSCR loans, though max LTV can be lower. See our Portland 5-8 unit page.
No. The loan qualifies on the property's rent, and LLC borrowers are standard.
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