Duplex
A residential building with two separate living units, either side-by-side or stacked.
Definition
A duplex is a property containing two independent residential units under one roof, each with its own entrance, kitchen, and bathroom. Duplexes can be structured side-by-side or with one unit above the other. They offer investors the benefit of two income streams from a single property, reducing vacancy risk compared to a single family rental. Duplexes are typically classified as residential (1-4 units) for financing purposes, qualifying for residential loan terms rather than commercial. Many investors start with duplexes because they can house hack by living in one unit while renting the other.
How This Relates to DSCR Loans
DSCR lenders treat duplexes as residential 1-4 unit properties. Both units' rental income is used in the DSCR calculation, often producing a stronger ratio than a single family home.
Related Terms
Triplex
A residential building with three separate living units.
Fourplex
A residential building with four separate living units — the largest property still classified as residential.
House Hacking
Living in one unit of a multifamily property while renting out the other units to cover the mortgage.
Multifamily
Residential properties with multiple units, ranging from duplexes to large apartment complexes.
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