Tampa multifamily lending

Short answer: Stabilized 5–20 unit multifamily in Tampa Bay trades at roughly 5.75%–6.75% cap rates, but insurance is the story — line items have moved 25–30% YoY for two straight years and carriers have exited Florida. A big insurance reset at closing can drop a deal below the 1.25 DSCR floor, so never underwrite Tampa without a binder quote.

Tampa is the hardest market to insure right now

That's the most important sentence on this page. Stabilized 5–20 unit cap rates run 5.75–6.75%, but insurance line items have moved 25–30% YoY in two consecutive years, and several carriers have pulled out of the Florida market entirely. Underwriting Tampa without a binder quote is malpractice.

How does the insurance shock hit your DSCR?

At a 6.0 cap, a "normal" Tampa 8-unit clears DSCR easily. After a 28% insurance reset on closing, the same deal can drop to 1.10–1.15 DSCR, below the lender floor. The carrier shock kills the loan, not the rate.

Underwriting checklist for Tampa

1. Get a binder quote — don't use the seller's premium.
2. Confirm flood zone (X, AE, VE) and add NFIP cost if needed.
3. Tax: Florida reassesses at sale price.
4. Hurricane impact-glass discount can lower premium 8–15%; verify.
5. Year-2 model with the new tax + the new insurance.

PathIQ exposes year-1 vs year-2 insurance and tax inputs separately so the DSCR card flags Florida deals that look stable on paper but won't be in 14 months.

Frequently asked questions

Why is insurance the biggest risk in Tampa multifamily?

Insurance line items have moved 25–30% YoY in two consecutive years, and several carriers have exited Florida entirely. A large reset at closing can single-handedly break a deal, which is why underwriting Tampa without a binder quote is malpractice.

What are cap rates in Tampa Bay right now?

Stabilized 5–20 unit product trades around 5.75%–6.75%. But cap rate alone is misleading here — the insurance line moves the return math more than the cap spread does, so always pair the cap with a current binder quote.

How much can an insurance reset move the DSCR?

At a 6.0 cap, a "normal" Tampa 8-unit clears DSCR easily, but after a 28% insurance reset at closing the same deal can drop to roughly 1.10–1.15 DSCR — below the ~1.25 lender floor. The carrier shock kills the loan, not the rate.

What else should I check before underwriting a Tampa deal?

Get a binder quote instead of using the seller's premium, confirm the flood zone (X, AE, VE) and add NFIP cost if needed, and remember Florida reassesses at sale price. Then model year-2 with both the new tax and the new insurance; impact-glass can trim the premium 8–15%.