In Seattle, the exit decides the deal
On a Seattle deal, the costly surprises tend to come at the sale, not the purchase: the excise tax the seller pays at closing, months of carry while a slower market finds a buyer, or a tenant the city's rules will not let you remove. If you are looking for a hard money lender in Seattle, the most useful thing you can do before you call one is price the exit as carefully as the entry.
The market has also changed under investors' feet. In August 2026 the Northwest Multiple Listing Service reported that King County had 4.3 months of inventory across all property types, up from 2.9 a year earlier. Its report said this was the first time in a long while the county had gone above four months, the level it treats as the start of a balanced market.
Houses cost less than a year ago, and there are more of them. The county's August median for residential sales was $920,000, down 7.1 percent from $990,000 in August 2025. Active residential listings rose about 33 percent, to 5,230, while closed sales fell about 9 percent, to 1,450.
For a buyer, more listings means more room to negotiate. For a flipper, it means the resale will sit on the market longer than last year's spreadsheet assumed. Budget for that time, because on short-term money every extra month is paid in interest.
The excise tax lands on your sale, not your purchase
Washington's real estate excise tax is graduated, and the Department of Revenue says the seller usually pays it. On a flip, the seller is you. The state portion for sales through December 31, 2026 is:
- 1.1 percent on the part of the price up to $525,000
- 1.28 percent on the part from $525,000 to $1,525,000
- 2.75 percent on the part from $1,525,000 to $3,025,000
- 3 percent on anything above $3,025,000
Seattle adds a local excise tax of 0.5 percent on the full price. Take a resale at the August King County median of $920,000: the state portion is $5,775 on the first $525,000 plus $5,056 on the next $395,000, or $10,831. The city's 0.5 percent adds $4,600, so the total is $15,431, before agent commissions or any other closing cost.
A flip bought this fall will probably sell in 2027, and the brackets move on January 1, 2027. The 1.1 percent band will run to $551,000 and the higher bands shift up by the same $26,000. That trims the tax a little on most resales, but run your numbers on the schedule in force on the day you expect to close, not the day you buy.
Seattle tenant rules can block a quick exit
Buying a property with a tenant in it is where Seattle surprises investors from other states. The city's Just Cause Eviction Ordinance requires a listed cause both to end a month-to-month tenancy and to decline to renew a lease when it expires. You cannot simply wait for a lease to run out and list the property empty.
Selling is one of the listed causes, but only for a single-family dwelling, which the city defines as a detached structure on its own foundation. It requires 90 days' notice. A condo, a duplex or an apartment does not qualify, so a tenant in one of those can stay through your sale. If your plan is to buy an occupied duplex, empty it and sell it renovated, check with a Seattle attorney before you make an offer, because the plan may not be available to you.
Major work brings its own process. When tenants are displaced by demolition or substantial renovation, Seattle requires a Tenant Relocation License from the Department of Construction and Inspections before the tenancy can be ended. The city says the licensing process takes about six months. Eligible low-income households receive relocation assistance, which the city lists at $5,552 per household, with half paid by the property owner. Put that time and cost in the plan before you price the renovation.
Working on a Seattle property?
Tell us the address, the price, your renovation budget and whether anyone lives there now. Our lending partner's team will review it and say whether it fits and on what terms. The lender makes every credit decision.
Holding a Seattle rental: three layers of rules
If the plan is to keep the property and refinance into a DSCR rental loan, you will answer to the state, the city and the city's registration program all at once.
The state rent cap. Since May 2025, Washington has limited rent increases to 7 percent plus inflation or 10 percent, whichever is less. The Department of Commerce set the 2026 maximum at 9.683 percent. No increase is allowed in the first 12 months of a tenancy. Units whose first certificate of occupancy was issued 12 or fewer years before the increase notice are exempt, which is one reason newer buildings price differently.
Seattle's longer notice. State law requires 90 days' written notice of a rent increase. Seattle requires 180. If an increase, alone or combined with others in a 12-month period, reaches 10 percent, an eligible tenant with income at or below 80 percent of area median who moves out can receive relocation assistance of three months' housing costs. The city pays the tenant first and the landlord must reimburse the city. With the state cap at 9.683 percent for 2026, a 10 percent increase is generally possible only on an exempt unit, such as newer construction.
Registration and inspection. Seattle's Rental Registration and Inspection Ordinance requires you to register a rental as soon as it has a tenant, and a short-term rental that is not owner-occupied must register before it is listed. Registration lasts two years and costs $126 for the first unit plus $31.50 for each additional unit at the same property. Each property is selected for a city or private inspection once in its first five years of registration.
None of this makes Seattle unworkable for a rental. It means the rent you underwrite is the rent the rules allow, raised once a year with six months' warning, and that a DSCR lender testing your rent against the payment will want to see a number you can actually collect.
Where the new opportunity is: more homes per lot
The change most likely to create Seattle deals is zoning. Washington's middle housing law requires cities of 75,000 or more people to allow four units per lot on land zoned mainly for homes, and six within a quarter mile walk of a major transit stop or where at least two units are affordable.
Seattle adopted interim rules to comply, effective June 30, 2025. In Neighborhood Residential zones they allow four units per lot, or six near a major transit stop or with two affordable units, with accessory dwelling units counted toward those limits. Lots with environmentally critical areas, such as steep slopes or wetlands, get proportionally less. The interim rules stay in place until the city adopts permanent ones, so check the current code for your specific parcel before you buy.
For an investor, that turns some ordinary single-family lots into small development sites. A house with a large yard near a light rail station may be worth more as a lot than as a renovation. That is a longer, more complicated project than a cosmetic flip, with permits, site work and a larger budget, so talk to the lender early about whether the project fits a bridge or construction program before you write an offer around it.
Carry costs to put in a Seattle budget
Property tax. King County bills property tax in two halves, due April 30 and October 31. If you hold through one of those dates, the payment comes out of your project budget, so ask at closing which half has been paid.
Time. Permits, a relocation license or a slower resale all add months. On a $644,000 loan at 12.99 percent interest only, each month costs about $6,970 in interest alone. A Seattle plan that works only if everything finishes on schedule is a plan with no margin.
Lending partner terms for Seattle investors
Fix and flip and bridge loans: standard pricing starts at 12.99 percent interest plus 2.99 points, interest only. The minimum loan is $50,000 and the minimum credit score is 600. The loan can cover up to 100 percent of cost, but never more than 70 percent of the after-repair value. Loyalty pricing of 10.99 percent plus 1.99 points opens up only after two loans have been paid off with the lending partner in good standing.
DSCR rental loans: $75,000 to $2 million, up to 80 percent of value, with no minimum credit score.
Here is how the 70 percent cap works at Seattle prices. A house worth $920,000 after renovation supports a loan of up to $644,000. If the purchase and renovation together cost $700,000, you bring at least $56,000, plus closing costs, and 2.99 points on the loan adds about $19,256. King County is not one of the counties where the lending partner limits leverage to 50 percent of value. Properties need an after-repair value of at least $100,000, borrowers generally show at least $15,000 in reserves, and the loan closes in an LLC, corporation or trust on a non-owner-occupied investment property. Condos, townhomes and one to four unit buildings are eligible. The lender reviews every file and confirms terms before you commit.
Thinking about keeping a Seattle property as a rental? Our two free landlord books compare what a rental costs to carry across twelve states.
Use the form below and our lending partner's team will tell you which program fits the plan.
Related guides
Washington · Denver · Austin · Miami · Construction loans · Fix and flip loans · DSCR rental loans · Rates and terms
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Questions Seattle investors ask
How much do hard money lenders in Seattle charge?
Our lending partner's standard pricing on fix and flip and bridge loans starts at 12.99 percent interest plus 2.99 points, interest only. Lower loyalty pricing applies only after two loans have been paid off with the lender. On a Seattle flip, also budget for the excise tax you pay as the seller when you resell.
Do hard money lenders require a down payment in Seattle?
Usually some cash, even though the loan can cover up to 100 percent of cost. The loan cannot exceed 70 percent of the after-repair value, so at Seattle prices that cap often decides how much you bring. Borrowers also generally need at least $15,000 in reserves.
Are hard money loans dangerous for a Seattle investor?
They are expensive short-term money, so the risk is time. Interest runs every month, and in Seattle a slower resale, a permit or a tenant who cannot be required to leave can add months. Price the exit, the excise tax and a realistic schedule before you borrow.
Who pays the excise tax when I sell a Seattle flip?
The Washington Department of Revenue says the seller usually pays it, so on a flip that is you. The state rate is graduated, starting at 1.1 percent on the first $525,000 of the price in 2026, and Seattle adds 0.5 percent on the full price.
Can I sell a Seattle rental with a tenant in it?
You can sell it, but you may not be able to empty it first. Seattle lets a landlord end a tenancy to sell only for a detached single-family house, with 90 days' notice. In a condo, duplex or apartment the tenant can stay, so check with a Seattle attorney before you buy.
Where do I find hard money lenders in Seattle?
Compare more than one, and ask each for its rate, points, leverage limits and fees in writing before you sign. You can also send your Seattle deal through the form on this page, and our lending partner's team will tell you whether it fits and on what terms.
Sources
- NWMLS August 2026 market report, King County months of inventory, the balanced market comment, listings and sales (accessed Oct 2026)
- NWMLS King County area statistics, August 2026, the residential median price, closed sales and active listings (accessed Oct 2026)
- Washington Department of Revenue, Real estate excise tax, the graduated state rates, the January 2027 thresholds and who usually pays (accessed Oct 2026)
- Washington Department of Revenue, Local REET rates from May 1, 2026, Seattle's 0.5 percent local excise tax (accessed Oct 2026)
- RCW 82.45.060, the graduated excise tax and its four-year threshold adjustment (accessed Oct 2026)
- City of Seattle, Just Cause Eviction Ordinance, just cause for non-renewal, the sale cause for single-family dwellings and its 90-day notice, and the roughly six months a relocation license takes (accessed Oct 2026)
- City of Seattle, Tenant Relocation Assistance Ordinance, the relocation license and the assistance amount and split (accessed Oct 2026)
- RCW 59.18.700, the statewide rent increase cap and the first-year rule (accessed Oct 2026)
- RCW 59.18.710, exemptions from the cap, including units within 12 years of first occupancy (accessed Oct 2026)
- Washington Department of Commerce, 2026 rent cap announcement, the 9.683 percent maximum for 2026 (accessed Oct 2026)
- RCW 59.18.140, the 90-day statewide notice for rent increases (accessed Oct 2026)
- City of Seattle, Housing cost increases, the 180-day notice and the 10 percent relocation trigger (accessed Oct 2026)
- City of Seattle, Economic Displacement Relocation Assistance, the income limit, three months of housing costs and landlord reimbursement (accessed Oct 2026)
- City of Seattle, Rental Registration and Inspection Ordinance for owners, when to register, fees, renewal and inspection selection (accessed Oct 2026)
- RCW 36.70A.635, the state middle housing requirement of four and six units per lot (accessed Oct 2026)
- City of Seattle, Interim zoning legislation summary, the Neighborhood Residential unit limits and the June 30, 2025 effective date (accessed Oct 2026)
- King County Treasury, Property tax FAQ, the April 30 and October 31 due dates (accessed Oct 2026)