Seattle's small apartment buildings, from brick walk-ups on Capitol Hill to 1960s boxes in Ballard and Fremont, are expensive per unit. They also come with city registration, strong tenant protections and seismic questions, so the deal has to work on current rents and conservative leverage.
In short: LendingStreet finances 5-8 unit buildings in Seattle and King County with DSCR loans that qualify on combined rent, with no W-2s or tax returns and LLC borrowers allowed. Loans start at $150,000 with no stated maximum, and leverage on 5-8 units varies by program. In Seattle the ratio often needs more cash down, and you should plan around state rent rules, city registration and the real estate excise tax.
Capitol Hill and First Hill have early 1900s brick walk-ups and converted houses. Ballard, Fremont, Wallingford and Greenwood have many 1960s and 1970s small buildings, and the U District has small buildings near the University of Washington.
Columbia City, Beacon Hill and West Seattle offer lower prices. Outside the city, Tacoma, Everett, Burien and Renton have more small buildings at lower prices per unit.
Many of the 1960s buildings in Ballard and Fremont are two or three stories over tuck-under parking, with studios and one-bedrooms. Capitol Hill walk-ups are older and often have no parking at all, which tenants there generally accept because of transit and walkability.
| Area | Typical building | Note |
|---|---|---|
| Capitol Hill and First Hill | Brick walk-ups | Seismic and parking |
| Ballard, Fremont, Wallingford | 1960s-70s small buildings | Strong demand |
| U District | Student buildings | Lease cycle |
| Tacoma and Everett | Older small buildings | Lower price per unit |
Washington adopted a statewide limit on annual rent increases in 2025, tied to inflation with a ceiling, and requires longer notice for increases. Seattle adds just-cause eviction rules and relocation assistance when large increases displace tenants.
Seattle requires landlords to register rental units under its Rental Registration and Inspection Ordinance (RRIO), with periodic inspections. Plan around in-place rents and include registration costs in your budget.
Seattle also has rules on tenant screening and limits on move-in fees and deposits. A local attorney can review your lease forms before you take over the building.
Our DSCR programs treat 5-8 units as residential. Qualification runs on rent, not on pay stubs or tax returns, and most investors close in an LLC. The floor is a 620 credit score, loan sizes begin at $150,000 with no stated cap, and 30-year terms are available.
Underwriting divides the building's total monthly rent by the monthly payment including taxes and insurance. A 1.0x result is the usual minimum, with sub-1.0 options on some programs. Leverage tops out at 80% LTV on purchases and 75% on cash-out for smaller rentals, and it often sits lower on 5-8 unit properties and larger balances, so expect it to vary by program.
On a building this size, the appraisal leans on the rent roll. Each unit's rent is compared with nearby rentals, so above-market leases or several vacant units can pull the supported income down. Bring leases and a clear note on any unit that is empty or under renovation.
Washington charges a real estate excise tax (REET) on sales with graduated state rates plus local tax, usually paid by the seller. King County reassesses annually, and Washington has no state income tax.
Budget property taxes on your purchase price and the county's current levy rate.
Seattle and King County levies, including voter-approved housing and transit measures, vary by location. Use the county's current tax statement for the parcel and adjust it toward your price, since values reset on reassessment.
This example is illustrative and not a quote. An investor buys a seven-unit 1960s building in Ballard for $2,350,000. The units rent for $2,050 each, for a combined $14,350 a month. Taxes are budgeted at $1,800 a month and insurance at $650.
Financing 70% of the price gives a $1,645,000 loan. Estimated principal and interest comes to about $11,502, the full payment to about $13,952, and the ratio to about 1.03x. Dropping to 60% LTV, a $1,410,000 loan, brings the payment to about $12,309 and the ratio to about 1.17x. At 70% LTV the building just clears 1.0x. At 60% it has a comfortable cushion. Most Seattle buyers end up between those two levels.
| Item | 70% LTV | 60% LTV |
|---|---|---|
| Purchase price | $2,350,000 | $2,350,000 |
| Combined monthly rent | $14,350 | $14,350 |
| Loan amount | $1,645,000 | $1,410,000 |
| Estimated principal and interest | $11,502 | $9,859 |
| Taxes and insurance | $2,450 | $2,450 |
| Total monthly payment | $13,952 | $12,309 |
| DSCR | About 1.03x | About 1.17x |
Seattle sits in an active seismic zone, and the city has inventoried unreinforced masonry buildings. Brick walk-ups may face higher premiums or carrier limits, and some buyers require retrofits.
Earthquake insurance is usually optional and separate. Get a full-building quote early.
Insurers also ask about older electrical service, galvanized plumbing and fire alarm systems in walk-ups. A recent building inspection report helps get a cleaner quote.
Prices relative to rent are high. Many buyers put 35% to 40% down, use a sub-1.0 program or look at Tacoma and Everett where rents are closer to prices.
Larger balances get more review and maximum LTV can be lower. See our jumbo DSCR page for Seattle.
Value-add opportunities exist, but tenant protections limit how fast you can turn units. Plan renovations on natural turnover, and size the loan on the rents you have today rather than the rents you hope to reach.
Pulling these together up front saves a round of follow-up questions.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the address, unit count, rent roll and the price or estimated value through the form below, or call (877) 298-1001.
We run the ratio on realistic taxes and insurance, test it at a few loan amounts and come back with options. For statewide rules, see our Washington 5-8 unit DSCR page.
Seattle's Rental Registration and Inspection Ordinance, which requires landlords to register units and allows periodic inspections.
Yes. A 2025 state law caps annual increases on most buildings. Check the current limit.
Usually the seller, at graduated state rates plus local tax.
Often yes, but insurance can be harder. Bring any seismic reports.
Yes. We finance 5-8 unit buildings across the Puget Sound region.
Yes. Our residential DSCR programs cover 1 to 8 units. Buildings with 9 or more units are financed as commercial.
The minimum is 620. Income documents are not required, because the loan is approved on the building's rent.
Sub-1.0 DSCR programs exist. A larger down payment also lowers the payment and can lift the ratio over 1.0x.
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