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Buying & Managing Real Estate – Lessons I’ve Learned From 2020

Saying that 2020 was a challenging year is a major understatement, considering what we’ve all experienced doing the past year. When the COVID pandemic hit in March, there was uncertainty of what might happen due to the mixed messages we were receiving at the time. Once the scope of the virus was clear, many predicted that multifamily investments would suffer due to high vacancy rates, delinquencies, and a variety of other negative outcomes.

There were also predictions of major price discounting of multifamily properties, which caused many investors to take a “wait and see” approach instead of taking advantage of excellent opportunities that were available. Fortunately, many of those negative predictions never happened (well, at least not yet). Rents remained stable, vacancy rates experienced a small rise, but nothing compared to the levels that were forecast. In fact, we even had remarkable rent increases at some of our properties during the pandemic. Fortunately, the anticipated “fire-sale” prices due to sellers’ panicking didn’t materialize either.

Despite all that transpired during 2020, I did learn some valuable lessons regarding buying and managing multifamily real estate. I will carry these lessons forward in the coming years and will share them with you now.

Lesson #1: It’s Still Very Much a Seller’s Market

One would have imagined that the pandemic of 2020 turned the multifamily market into a buyer’s market. With all the uncertainty and economic chaos that the COVID pandemic produced, you might have expected panic selling of assets and buyer’s picking and choosing from a variety of “fire-sale” prices. Fortunately, that never happened, and it’s still very much a seller’s market.

If you think back to the months of March through May, the market basically froze. Since buyers were expecting prices to drop, and sellers were unsure of what the pandemic would do to their properties, nobody acted, and it was a frozen market. However, from May on it was a market similar to the previous year when there wasn’t a pandemic – and it became a seller’s market.

Even during the height of the pandemic, it was a seller’s market, with property owners asking high prices and wanting to see hard money deposited with their escrow company. That has not changed due to COVID, and sellers are receiving multiple bids on every deal, with multiple buyers to choose from.

One example was a multifamily property that was on the market in Dallas Ft. Worth. It’s a highly competitive market, but we were very interested in bidding on it. I received a call from the broker stating that we were potential buyer number 37, which means there were 36 other bidders interested in the property. That shows just how strong a seller’s market we’re in, even during a pandemic.

Lesson #2: Patience is a Virtue

How many times have you heard that expression? It dates way back to a poem written in 1380 and is credited to William Langland. It is defined as having the ability to wait and accept delay or trouble without getting angry or upset. Many believe that patience is a skill that can be increased, and that we all have the capacity to become a more patient person.

When it comes to purchasing multifamily real estate, I’ve found that you absolutely have to be patient. Achieving success takes time, often taking a lot of time. You don’t build wealth overnight; you build it over time. Often, it feels that waiting for months at a time for the “right” opportunity to come along seems like an eternity. However, in the scope of life and all that we do, a period of several months is just a blip on the scale of time.

I’ve watched other syndicators set unrealistic expectations for their business. Some feel that they simply “must” make 2 deals per quarter, or have a dollar amount in mind for the year that must be achieved. This is how syndicators get into trouble, because instead of being patient, they’re rushing into a deal just to meet their own expectations. This happens despite the fact that the market might not be right, the timing might not be right, or the price of the property might not be right.

As a conservative investor, I have learned that patience is indeed a virtue. Our investors appreciate the fact that we’re not rushing into a deal or pushing a particular opportunity just for the sake of meeting an arbitrary expectation or deadline. It’s of particular importance to me, as I invest my own money and often my family’s money, in every property I buy. If I have to wait for a better price or better timing, I’m more than willing to do that.

In addition, as a fiduciary, I have an obligation to my investors to bring them the right type of deals. At Blue Lake Capital, we’re always actively underwriting properties, speaking with brokers, talking with property managers, and visiting potential properties. This pays off for our investors, because several months ago we closed an exceptional deal in Marietta, Georgia because we were willing to wait for the right deal to come along; when it did, we were ready to take advantage of the opportunity.

Lesson #3: Income is Increasing – and so are Expenses

The third lesson I learned during the past year relates to managing our assets. Thankfully, income is still increasing. Net Operating Income (NOI) continues to increase month-over-month, and overall income is also increasing, depending on where the investments are located. There has been a hefty increase in rents in Atlanta and Texas, for example, as these states are now the destination of many New Yorkers who are moving out of the city.

This influx of population has had a major impact on the rental market and has helped us push rents and occupancy at our properties located in these 2 states. At one apartment complex that is located about 20 miles outside of Atlanta, we were able to raise rents substantially. However, while income is increasing, so are monthly expenses and capital expenditures.

Due to COVID, it is now costing more to operate and maintain multifamily properties. For example, the cost of appliances has increased over the past year. In addition to increased prices, due to COVID’s impact on the global supply chain, it is also impacting the amount of time it takes to receive our orders. If we order appliances today, it might take up to two months to get delivery. The price increases impact how the property is generating cash flow, while the long delivery time wreaks havoc on our ability to execute our value-add plan and renovate our units on a realistic schedule.

Renovations that used to take 10-days can now be delayed for up to 45 days on average, which takes units off the market for unreasonable amounts of time. The problem is not only related to appliances; costs for just about everything have gone up, from countertops to insurance premiums. One of the ways to manage rising expenses is to review all ongoing contracts, including landscaping, painting, plumbing, HVAC and others, and renegotiate those contracts on a regular basis.


Many of the predictions for multifamily properties that came after the pandemic struck never materialized. This is quite fortunate, as most would have had negative outcomes. This included high vacancy rates, rent discounts, delinquencies, and other rental issues. In addition, there were predictions that many sellers would panic and drop their prices while buyers would be lining up for “fire-sale” bargains. This, too, never materialized, and the multifamily market is as strong as ever.

I did learn some interesting lessons about buying and managing multifamily properties during the past year. The first lesson was that multifamily is still very much a seller’s market. Property owners didn’t panic, and there were no fire-sale prices for buyers to choose from. Despite the pandemic, sellers are still receiving multiple offers on their properties, with multiple buyers to choose from. Prices have held steady and should remain so in the coming year.

The second lesson I learned is that patience is a virtue. Achieving success does take time, and you can’t build wealth overnight. Some syndicators set unrealistic timelines for their business, expecting to complete 2 deals per quarter or invest in a certain number of properties each month. This puts pressure on them to accept deals that might not be at the right price, or at the right time, or in the correct market. By being patient, we were able to close a deal near Atlanta that we were ready for because it was at the right price, at the right time, and in the right market.

The third lesson I learned is that while income is increasing, so are expenses. Due to the pandemic, prices on just about everything have gone up, and it also has impacted the global supply chain; this means it may take a lot longer to get delivery on key items. Appliances, for example, that used to take 2 weeks for delivery, now take up to 45 days. This delays our value-add process, as renovation schedules are thrown off completely. One way to deal with rising expenses is to get competitive bids on all recurring expenses and work to find lower monthly costs.

Want to Invest with Ellie?

If you are interested in learning more about passively investing in apartment buildings, click here to schedule a call with Ellie Perlman.

About the Author

Ellie is the founder of Blue Lake Capital, a real estate company specialized in multifamily investing throughout the United States. At Blue Lake Capital, Ellie helps investors grow their wealth and achieve double-digit returns by investing alongside her in exclusive multifamily deals they usually don't have access to.

Ellie is the host of REady2Scale , a podcast that highlights honest, insightful, and thought-provoking discussions on the multiple approaches for successful real estate investing.

She started her career as a commercial real estate lawyer, leading real estate transactions for one of Israel’s leading development companies. Later, as a property manager for Israel’s largest energy company, she oversaw properties worth over $100MM. Additionally, Ellie is an experienced entrepreneur who helped build and scale companies by improving their business operations.

Ellie holds a Masters in Law from Bar-Ilan University in Israel and an MBA from MIT Sloan School of Management.

You can read more about Blue Lake Capital at and learn more about Ellie at


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