Property Search
Guides
- All Guides
- Buying a Home
- Selling a Home
- Life Transitions
- Investing
- Building and Adding Value
- Commercial Property
- Homeowner Guides
- Blog
Resources
About
Call (916) 436-3776Multifamily (5+ Units) California
How Do I Buy or Sell a 5+ Unit Apartment Property in California in 2026?
At five or more units, an apartment property is commercial real estate: it's financed with commercial loans and valued off net operating income (NOI) and the market cap rate, not comparable home sales. In 2026, California multifamily cap rates average around 5.6% (tighter in premium metros), financing runs from agency (Fannie/Freddie) to commercial DSCR and bridge loans, and lenders underwrite the property's cash flow and debt-service coverage rather than just your income. Serve First underwrites and brokers the deal; Ashlar Lending arranges the commercial financing; Ashlar LDA prepares the entity.
Buying a 5+ unit apartment property is a different game from buying a house. At five units, you cross into commercial real estate: the property is underwritten as an income-producing business, financed with commercial loans, and valued off its net operating income and the market cap rate rather than comparable home sales. That means the analysis, rent roll, expenses, vacancy, debt-service coverage, matters more than any single feature. This guide covers how multifamily deals are financed and evaluated, then links to a guide for your area. Ashlar Lending arranges the commercial financing, Serve First underwrites and brokers the deal, and Ashlar LDA handles the entity. For the tax side of trading up, 1031 exchanges, depreciation, see our guide for landlords and your CPA.
One family. Deal, financing, and entity.
Buy or sell the building, with commercial financing built in
A 5+ unit property is an income-producing business, financed and analyzed differently from a house. The Ashlar Brands family works it end to end:
- Serve First Realty sources multifamily deals, underwrites the rent roll and net operating income, and represents you on the buy side or the sale, pricing off cap rate and income, not comparable home sales.
- Ashlar Lending Inc. (NMLS #2699657) arranges the commercial financing 5+ units require: agency (Fannie/Freddie small-balance), commercial DSCR, portfolio, and bridge loans, underwriting the property’s cash flow and structuring leverage to the deal.
- Ashlar LDA, Inc., a bonded and registered Legal Document Assistant, can prepare the LLC or entity paperwork that typically holds the asset, plus deeds, at your direction.
These are separate businesses in the Ashlar Brands family. Serve First is a real estate brokerage, not a lender or law firm; loan terms are set by the lender. A Legal Document Assistant prepares documents at your direction and is not a substitute for an attorney. This is general information, not tax advice: consult your CPA on 1031, depreciation, and recapture.