Miami's small apartment buildings are mostly two-story concrete block walk-ups from the 1950s through the 1970s. They are in demand, expensive and costly to insure, so leverage has to fit the numbers.
In short: LendingStreet finances 5 to 8 unit rental buildings across Miami-Dade County with DSCR loans that qualify on rent, with no W-2s or tax returns. Loans start at $150,000 with no stated maximum and a 1.0x standard minimum DSCR. In Miami, wind and flood insurance, the building recertification program and Miami-Dade's doc stamp surtax all affect the numbers, and lower leverage is often needed.
Little Havana, Allapattah, Little River and Shenandoah have many concrete block walk-ups. Edgewater and Wynwood have older buildings near new towers. North Miami, Hialeah and Westchester offer small buildings at somewhat lower prices. North Beach in Miami Beach has 1950s buildings near the ocean.
Coconut Grove and Coral Gables have few small buildings, and those that trade are expensive.
Most of these buildings were built with concrete block walls and flat or low-slope roofs, often with exterior walkways and small parking lots. Concrete holds up well against wind, but older buildings may have spalling, rusted rebar or aging electrical that recertification inspections will flag.
| Area | Typical stock | Key issue |
|---|---|---|
| Little Havana and Allapattah | 1950s-1970s concrete block walk-ups | Recertification, rent levels |
| Little River and Shenandoah | Small buildings | Rising prices |
| North Miami and Hialeah | Small buildings | Lower prices, flood zones |
| North Beach | 1950s buildings near the ocean | Flood and wind insurance |
Miami-Dade requires older buildings above a size threshold to pass structural and electrical recertification at 40 years and every 10 years after. Many 5-8 unit buildings are covered. Ask for the current recertification status and any required repairs before you buy.
State condo safety laws passed after the 2021 Surfside collapse mostly apply to condominium associations, not a building owned by one investor, but they have raised awareness of structural risk.
If recertification is overdue or repairs are outstanding, the county can issue violations and, in serious cases, order the building vacated. Underwriters and insurers will both want to see that the building is current, so make recertification status part of your first round of diligence.
This example is illustrative and not a quote. An investor buys an eight-unit concrete block building in Little Havana for $2,000,000. Rents average $1,950 per unit across all 8 units, for $15,600 of gross monthly rent. The budget carries $3,300 a month for taxes and $1,700 for insurance.
With a 75% LTV loan of $1,500,000, estimated principal and interest runs about $10,488 and the total payment about $15,488, which puts DSCR near 1.01x. Cutting leverage to 65% LTV, a $1,300,000 loan, lowers the payment to about $14,090 and lifts DSCR to about 1.11x, at the cost of $200,000 more down.
At 75% LTV the ratio is barely above 1.0x, and many programs set lower maximum leverage on a balance this size. Dropping to 65% gives a cushion.
| Item | 75% LTV | 65% LTV |
|---|---|---|
| Purchase price | $2,000,000 | $2,000,000 |
| Loan amount | $1,500,000 | $1,300,000 |
| Down payment | $500,000 | $700,000 |
| Estimated principal and interest | $10,488 | $9,090 |
| Property taxes (monthly) | $3,300 | $3,300 |
| Insurance (monthly) | $1,700 | $1,700 |
| Total monthly payment | $15,488 | $14,090 |
| Gross monthly rent | $15,600 | $15,600 |
| DSCR | About 1.01x | About 1.11x |
Miami-Dade charges documentary stamp tax on deeds at a different rate than the rest of Florida, plus a surtax on property other than single-family homes. A 5-8 unit building is subject to the surtax. The seller usually pays deed doc stamps, but contracts vary.
The borrower pays doc stamps on the note and intangible tax on the mortgage.
Florida also charges documentary stamp tax on the promissory note and an intangible tax on the mortgage, both paid by the borrower. On a seven-figure loan these add several thousand dollars to closing costs.
Miami-Dade sits in the High Velocity Hurricane Zone, with strict building code requirements. Insurance premiums are among the highest in the country. Many buildings are in mapped flood zones where flood insurance is required.
Impact windows, a newer roof and wind mitigation features can lower premiums.
Coastal areas in Miami Beach and parts of the mainland face tidal flooding, and some buildings sit in coastal high hazard zones. Ask whether the building has a flood elevation certificate, which can help price flood coverage.
Miami rents are high, but so are prices, taxes and insurance. Rental property does not get the homestead exemption, and value resets after a sale. Budget taxes on your price.
Underwriters use the appraiser's market rent for each unit. In neighborhoods where rents rose quickly, recent leases may be higher than older in-place leases, and the appraiser may use the lower in-place rent for occupied units.
Because the tax and insurance lines are so large, many Miami buyers look at the building at 60% to 70% LTV first, then check whether higher leverage still clears 1.0x.
Our DSCR loans treat a Florida building of five to eight units as residential, 1 to 8 units, rather than commercial. That means qualification on the property's rent instead of your personal income, with no tax returns or W-2s, and title held in an LLC as a matter of course.
Minimum loan size is $150,000 and there is no stated cap. Program maximums are 80% LTV on a purchase and 75% LTV on a cash-out, with rate-and-term up to 80% on some programs; expect less on many 5-8 unit files, since leverage varies by program and balance. The usual floor is a 1.0x ratio and a 620 score, with sub-1.0 options for thin-margin buildings. Cash-out seasoning also varies by program.
Our investor loans are business-purpose loans on non-owner-occupied property. A complete package gets a faster answer, so gather the items below and send them through the form below, or call (877) 298-1001. The Florida 5-8 unit DSCR page covers statewide issues; buildings of nine or more units belong on our commercial and multifamily pages.
Older buildings above a size threshold need structural and electrical recertification at 40 years and every 10 years after. Many small apartment buildings are covered.
Yes. Miami-Dade adds a surtax on deeds for property other than single-family homes, which applies to 5-8 unit buildings.
Hurricane exposure, the High Velocity Hurricane Zone building code and widespread flood risk all push premiums up.
Yes. High taxes and insurance often mean the building only clears 1.0x at lower LTV, and larger balances may have lower maximum leverage.
No. Rentals are taxed at full value, and the assessment resets to market after a sale.
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.
Yes. LLC borrowers are standard on our DSCR loans, and you sign for the loan personally as part of the process.
No. Our investor loans are business-purpose loans on non-owner-occupied property, so every unit must be rented to tenants.
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