Selling · 8-unit
Selling a 5–9 Unit Apartment Building in Los Angeles
5–9 unit LA apartment buildings sit at the entry level of commercial multifamily. They require agency or bank financing (residential 1–4 loans no longer apply) but attract experienced first-time-institutional buyers and 1031 exchangers stepping up from smaller product.
Buyer profile
Buyers are typically private investors trading up from 4-units, 1031 exchangers matching sale proceeds, and small syndicators building a portfolio. Family offices and wealthy individuals dominate. Institutional capital rarely engages under 20 units because check size is too small for their overhead.
Financing patterns
Agency small-balance loans (Fannie Mae Small Loan program, Freddie SBL) or bank portfolio debt. Typical 65–75% LTV at 1.25x DSCR. Rates 25–50bps above the largest agency loans due to smaller size. Bank options often more competitive for local Southern California buyers.
Typical timeline
75–120 days from listing to close is typical. Agency debt underwrite adds 60–90 days from application to funding, which extends escrow. Marketing runs 21–30 days; escrow 45–60 days. Bank debt closes faster (30–45 day escrows) when the borrower has a strong bank relationship.
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