Small apartment buildings of 5 to 8 units are not common on the Grand Strand. Most rental housing here is single-family homes, condos or large complexes. When a 5 to 8 unit building does come up, investors who already know how to finance it can move first.
In short: LendingStreet finances 5 to 8 unit residential buildings in the Myrtle Beach area with DSCR loans that qualify on the building's combined rent rather than your tax returns. Loans start at $150,000 with no stated maximum, the standard minimum DSCR is 1.0x, the minimum credit score is 620 and LLC borrowers are standard. Maximum LTV on 5 to 8 unit properties is often lower than on 1 to 4 units and varies by program.
Most small apartment buildings here are older garden-style or two-story walk-ups. In Myrtle Beach, they are found on side streets in older neighborhoods west of Kings Highway and near downtown. In Conway, small buildings near downtown and on routes toward Coastal Carolina University rent to students, university staff and hospital workers. North Myrtle Beach and Surfside Beach have some older multi-unit buildings that date from before the area's condo boom.
Many larger complexes along US 501, SC 544 and in Carolina Forest have far more than 8 units, which makes them commercial. A building of 9 or more units falls under our multifamily or commercial programs.
Because so few of these buildings trade, sellers are often long-time local owners who manage the property themselves. That can mean below-market rents and informal leases, which is an opportunity but also means the income on day one may be lower than the building's potential. Underwrite the rents in place, not the rents you hope to reach.
We add up the rent for all units and compare it with the full monthly payment: principal and interest, property taxes, insurance and any association dues. Leases for each unit, or the appraiser's market rent estimate, set the income. Vacant units are generally counted at market rent once they are leasable, but a building with several empty units may need a bridge loan first.
| Factor | 1 to 4 units | 5 to 8 units |
|---|---|---|
| Income used | Combined rent | Combined rent from a rent roll |
| Max LTV | Up to 80% purchase | Often lower, varies by program |
| Appraisal | Residential appraisal | Often more detailed income review |
| Insurance | Homeowner-style landlord policy | Building policy, often with separate wind |
| Typical Grand Strand stock | Houses, duplexes, condos | Older walk-ups, small garden buildings |
This example is illustrative and not a quote. An investor buys a 1980s two-story 6-unit building in Conway for $780,000. Each unit rents for $1,150, for $6,900 a month combined. Taxes at the 6% assessment ratio are budgeted at $700 a month, and a building insurance policy with wind coverage is quoted at $650 a month.
At 70% LTV the loan is $546,000. Estimated principal and interest is $3,725, for a total payment of $5,075. DSCR is about 1.36x, comfortably above the 1.0x standard minimum. The same building at 75% LTV, if the program allows it, would have a $585,000 loan, a $5,341 payment and a DSCR of about 1.29x.
| Item | 70% LTV | 75% LTV |
|---|---|---|
| Loan amount | $546,000 | $585,000 |
| Estimated principal and interest | $3,725 | $3,991 |
| Property taxes | $700 | $700 |
| Insurance | $650 | $650 |
| Total monthly payment | $5,075 | $5,341 |
| Combined rent (6 x $1,150) | $6,900 | $6,900 |
| DSCR | About 1.36x | About 1.29x |
Insurance is often the biggest surprise on a Grand Strand multi-unit purchase. Older buildings with original roofs, older electrical panels or no wind mitigation features can be expensive to insure, and some carriers will not write wind coverage near the coast, sending owners to the South Carolina Wind and Hail Underwriting Association. Flood zones add another policy. Get a full quote before you finalize your offer, and ask about roof age, wiring and building materials.
Building codes also matter. If a building needs major repairs after a storm, owners can face requirements to bring it up to current standards, so knowing the construction type and age of systems helps you and the insurer price that risk.
Every unit in a rental building is assessed at the 6% assessment ratio, and rentals pay school operating millage. The purchase also allows the county to reset the assessed value to the price paid. A seller who owned the building for decades may have a much lower bill than you will, so budget taxes on your purchase price using current millage for the city or unincorporated area.
On a 5 to 8 unit building, the rent roll is the heart of the file. Compare each lease with the rent roll, check for concessions, and note who pays utilities. Separately metered units help, since owner-paid utilities reduce your margin. Ask about deferred maintenance such as roof, HVAC units and parking lot condition.
A building where tenants pay their own electric and the owner pays only water and sewer will generally show a better margin than one where the owner pays everything. If a seller pays utilities for all units, factor that into your offer even though the DSCR math uses principal, interest, taxes, insurance and dues.
Coastal Carolina University gives Conway a steady base of student and staff renters, and Conway Medical Center adds healthcare workers. Units near campus can lease quickly, though student leases often follow the academic calendar. Year-round workforce tenants near downtown may offer more stable occupancy. Check whether the city has rules on occupancy limits for unrelated tenants.
Student housing near campus also tends to turn over every summer, which means repainting, cleaning and re-leasing on a tight schedule. Budget for that turnover, and keep in mind that the appraiser will look at what comparable units near the university actually rent for, not the highest rent you have seen advertised.
Send the address, price, rent roll and any operating history. We will run the ratio at more than one leverage level and tell you what fits. Use the form below or call (877) 298-1001. See our South Carolina 5 to 8 unit page for statewide information and our main 5 to 8 unit guide for program basics.
Yes. Residential DSCR programs cover 1 to 8 units, qualifying on the building's combined rent.
It is often lower than on 1 to 4 units and varies by program. We will tell you what the building supports.
No. The loan qualifies on the property's rent compared with its payment.
Vacant units are often counted at market rent once leasable, but a building with several vacancies may need a bridge loan first.
No. Buildings of 9 or more units are commercial. See our multifamily page.
Coastal wind exposure, building age and flood zones all raise premiums. A newer roof and wind mitigation features can help.
Yes. LLC borrowers are standard, and you sign for the loan personally.
No. Our investor loans are business-purpose loans on non-owner-occupied property.
2-3 competing quotes from 30+ capital sources. No credit pull. No commitment.
By clicking, you provide express written consent to be contacted by LendingStreet (NMLS #1734316) via SMS, phone, or email, possibly using automated technology, regarding your loan inquiry. Reply STOP to opt out. Consent is not required to obtain services. See our Privacy Policy and Terms.