Five to eight unit buildings in the Charleston area are rare and command premium prices. On the peninsula they are usually historic houses divided into apartments; in North Charleston and West Ashley they are small brick buildings. Flood exposure and South Carolina's 6% assessment ratio on rentals drive the math.
In short: Yes, LendingStreet finances 5 to 8 unit rental buildings in Charleston 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, the standard minimum DSCR is 1.0x and maximum LTV on 5-8 units varies by program. In Charleston, the assessment ratio for rentals, flood and wind insurance, and city limits on short-term rentals are the items to understand first.
On the peninsula, Wagener Terrace, Hampton Park, Cannonborough-Elliotborough and the blocks near MUSC and the College of Charleston have historic single houses and larger homes divided into five or six units.
North Charleston's Park Circle area, West Ashley and James Island have small brick apartment buildings from the 1950s through the 1970s, often at lower prices than the peninsula. Summerville and Goose Creek add newer options.
| Area | Typical building | What to check |
|---|---|---|
| Peninsula, Wagener Terrace | Historic houses divided into units | Flood zone, historic review, high prices |
| Park Circle, North Charleston | Small brick buildings | Renovation quality, flood zone |
| West Ashley, James Island | 1950s-70s small buildings | Drainage, insurance, updated systems |
Our residential programs cover one to eight units, so a six or eight unit building in Charleston is underwritten much like a fourplex, only with more rent and more units to document. Properties with nine or more units are commercial and are handled separately on our commercial programs.
Qualification runs on the property's rent, not your income: no W-2s, no tax returns, LLC ownership allowed. Loans start at $150,000 with no stated maximum, the minimum credit score is 620 and standard programs look for a DSCR of at least 1.0x. Purchases can go up to 80% LTV on some programs and cash-out up to 75%, but 5-8 unit buildings often get lower maximums; it varies by program.
Buildings that need major work before they can be leased are often financed first with a bridge or rehab loan, then refinanced into a DSCR loan once the units are rented. Seasoning for that refinance varies by program, so plan the timing before you buy.
South Carolina assesses an owner's primary residence at a 4% assessment ratio and rental property at a 6% assessment ratio. That difference can raise a rental's tax bill sharply compared with what an owner-occupant paid, so budget on the 6% assessment ratio.
South Carolina's deed recording fee is $3.70 per $500 of value, typically paid by the seller. Title, recording and lender costs also apply.
The City of Charleston requires permits for short-term rentals and limits them in many residential areas, so a five to eight unit building here should be underwritten on 12-month leases unless the address is confirmed legal for STRs.
Buildings on the peninsula are often in the Old and Historic District or under the Board of Architectural Review, which governs exterior work.
This example is illustrative and not a quote. Picture a 6-unit brick building in Park Circle priced at $1,050,000. With units averaging $1,450, the building brings in $8,700 a month. The budget uses $1,310 a month for taxes and $750 for insurance.
At 75% LTV the loan is $787,500, estimated principal and interest is about $5,506 and the total payment is about $7,566, for a DSCR of about 1.15x. At 70% LTV the loan drops to $735,000, the total payment to about $7,199 and the DSCR rises to about 1.21x. Coastal insurance on top of a 6% assessment ratio tax line keeps the ratio modest, which is common in Charleston.
| Item | 75% LTV | 70% LTV |
|---|---|---|
| Loan amount | $787,500 | $735,000 |
| Gross monthly rent | $8,700 | $8,700 |
| Estimated principal and interest | $5,506 | $5,139 |
| Property taxes | $1,310 | $1,310 |
| Insurance | $750 | $750 |
| Total monthly payment | $7,566 | $7,199 |
| DSCR | About 1.15x | About 1.21x |
On a five to eight unit building, the appraiser usually looks at comparable small-building sales and at the income the units produce. The rent used for the ratio comes from current leases and a market rent estimate for each unit, and the lower of the two figures is often what counts.
That makes a clean rent roll worth the effort. List every unit, its rent, its lease dates and any concessions, and be ready to explain units that are vacant or leased below market.
Much of Charleston is low-lying, and tidal and rain flooding are common on the peninsula and in parts of West Ashley and James Island. Flood insurance is often required, and wind coverage on the coast is expensive.
Get a flood determination, an elevation certificate if available and a full insurance quote before you set your offer.
MUSC, the port, Boeing and a growing tech sector support rental demand, but prices are high relative to rent, and insurance takes a large share. Many small buildings here need a larger down payment to clear 1.0x.
Sub-1.0 DSCR programs exist for files that come in just under.
Before you apply, pull together the paperwork that shows the building's income and costs. Then send it through the form below or call (877) 298-1001.
Our investor loans are business-purpose loans on non-owner-occupied property, and LendingStreet reviews each building on its own rent and costs. Share the rent roll, taxes and insurance quote, and the team will show you how the ratio changes at different loan amounts.
South Carolina taxes rentals at a 6% assessment ratio, compared with 4% for a primary residence.
Often, yes, if the property is in a mapped flood zone. Even outside one, many investors choose to carry it.
Charleston limits STRs in many residential areas. Most small buildings are underwritten on long-term leases.
Generally yes. Park Circle and other North Charleston areas usually price below the peninsula, though flood zones and insurance still matter.
Underwriting looks at leases and market rent for each unit. A vacant unit may be counted at market rent on some programs, but documented leases help.
No. Our investor loans are business-purpose loans on non-owner-occupied property.
On our programs, buildings with up to 8 units are residential. Nine or more units is commercial financing.
The standard minimum is 1.0x, meaning the rent covers the full monthly payment. Sub-1.0 DSCR programs exist with different pricing and leverage.
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