Harrisburg's small multifamily stock is mostly old: brick rowhomes and Victorian townhouses that were split into apartments decades ago. That history is the opportunity and the underwriting challenge.
In short: LendingStreet finances 5 to 8 unit rental buildings in Harrisburg and the surrounding Dauphin and Cumberland County suburbs with DSCR loans qualified on rent, not personal income. Loans start at $150,000 with a 1.0x standard minimum DSCR and LLC borrowers welcome. In Harrisburg, confirm the legal unit count and the city rental permit, budget for Pennsylvania's transfer taxes, and check Susquehanna River flood maps.
Midtown and Uptown have the largest concentration of three-story rowhomes converted to four, five or six apartments, many near the Broad Street Market and the state office complex. Allison Hill has larger, lower-priced buildings with higher turnover. Shipoke and the riverfront blocks are attractive but sit low next to the river.
Across the river, Camp Hill, Lemoyne and New Cumberland on the West Shore have fewer 5-8 unit buildings, but the ones that trade tend to be well kept and lease quickly to state and hospital employees.
| Area | Typical stock | What to check |
|---|---|---|
| Midtown and Uptown | Converted three-story rowhomes | City rental permit, fire separation |
| Allison Hill | Large older buildings | Condition, collections history |
| Shipoke and riverfront | Historic townhouses | Flood zone and flood premium |
| West Shore boroughs | Small brick buildings | Limited supply, borough rules |
Many Harrisburg conversions were done before current codes. Before you count six units, confirm that the city recognizes six units, that each has proper egress, and that utilities are separated where tenants pay them. Owner-paid heat on a single boiler is common in older buildings and can be a large expense.
Appraisers will value the building on its legal unit count. If records show four units and the building has six, expect the value and usable rent to reflect four.
This example is illustrative and not a quote. An investor buys a Midtown rowhome legally converted to five apartments for $525,000. Gross rent is $5,250 a month, an average of $1,050 for each of the 5 units, and the monthly budget includes $760 in taxes and $300 in insurance.
A $393,800 loan (75% LTV) carries estimated principal and interest of about $2,754, a full payment near $3,814 and a ratio of about 1.38x. Dropping to 70% LTV, or $367,500, brings the payment to about $3,630 and the ratio to about 1.45x; the investor needs $26,300 more cash.
Five units is the smallest building this page covers, and a thin rent roll makes every expense count. If the owner pays heat, that cost does not enter the DSCR but does affect real cash flow.
| Item | 75% LTV | 70% LTV |
|---|---|---|
| Purchase price | $525,000 | $525,000 |
| Loan amount | $393,800 | $367,500 |
| Down payment | $131,200 | $157,500 |
| Estimated principal and interest | $2,754 | $2,570 |
| Property taxes (monthly) | $760 | $760 |
| Insurance (monthly) | $300 | $300 |
| Total monthly payment | $3,814 | $3,630 |
| Gross monthly rent | $5,250 | $5,250 |
| DSCR | About 1.38x | About 1.45x |
Pennsylvania charges a 1% state realty transfer tax, and local municipalities and school districts add their own, so the combined tax is commonly 2% or more of the price. It is customarily split between buyer and seller, but contracts vary.
Pennsylvania has no statewide reassessment schedule, and many counties go years between countywide reassessments. Assessed values can lag market value, and the tax bill depends on the assessment, the county, city and school millage. Pull the current bill and ask whether a reassessment or an assessment appeal is pending.
The Susquehanna has flooded Harrisburg repeatedly, including Tropical Storm Agnes in 1972 and Tropical Storm Lee in 2011. Shipoke and other low blocks along Front Street and Paxton Creek are in mapped flood zones, where flood insurance is generally required on a financed building.
Older masonry buildings also need attention to roofs, chimneys and basement water. Share inspection findings with your agent before you finalize the budget.
The City of Harrisburg requires residential rental properties to be registered and permitted, and rental units are subject to codes inspections. Ask the seller for the current permit and any open violations, and confirm the permitted unit count matches the rent roll.
West Shore boroughs and townships have their own rental registration rules. Confirm them with the municipality before closing.
A five to eight unit rental in Harrisburg qualifies the same basic way as a duplex: the combined rent of every unit has to cover the full monthly payment. Lenders look at the rent roll, current leases and the appraiser's market rents, and use the lower figure where they differ. Your W-2s and tax returns stay out of it.
You can borrow from $150,000 with no stated maximum, up to 80% LTV to buy and up to 75% LTV on a cash-out refinance, though 5-8 unit properties often top out lower depending on the program. The standard minimum ratio is 1.0x with a 620 credit score floor, LLC ownership is normal, and 30-year terms are available. Buildings just below 1.0x can be reviewed for a sub-1.0 program.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the address, price or estimated value, the rent roll and your target leverage through the form below, or call (877) 298-1001. For the statewide view, see our Pennsylvania 5-8 unit DSCR page. Buildings with nine or more units move to commercial financing on our multifamily loans page.
It is customarily split between buyer and seller, though the contract controls. The combined state and local tax is commonly 2% or more of the price.
Yes. The city requires rental registration and permits, with codes inspections of rental units. Confirm the permit and unit count before closing.
The loan will be based on the legal unit count. Extra unpermitted units usually do not count toward value or rent.
Much of it is. Check the FEMA map and get a flood quote before you set your loan amount.
Yes. Camp Hill, Lemoyne, New Cumberland and the surrounding townships each set their own rental registration, inspection and zoning rules, and their school district millage differs from Harrisburg's. Check the municipality before you buy.
No. The loan qualifies on the building's rent, not your personal income, so W-2s and tax returns are not required. A 620 minimum credit score applies.
Yes, up to 75% LTV on a cash-out refinance, often lower on 5-8 units. Seasoning requirements vary by program, and the rent must still cover the new payment.
Not with our DSCR program. Properties with 1 to 8 units are financed as residential investment property, qualified on rent. Nine units and up is commercial.
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