S4 EP 266: How the Current Economy is Affecting Deal Flow with Ellie Perlman

Published: Oct. 5, 2022, 9 a.m.

When is the next deal coming?\n\nThis is a question I get a lot from our investors, so I wanted to share our view on how the current economy is affecting real estate deal flow.\n\nWe all know that, right now, interest rates and rents are going up across the country, but what\u2019s the impact been on acquisitions? In terms of the deal flow specifically, there\u2019s been a slow down over the past few months since the Fed declared their intention of increasing rates. \n\nIs multifamily still a very strong asset class to invest in? Absolutely. Is it a \u201cbulletproof\u201d asset in a recession? There's no such thing. While you can\u2019t say it\u2019s \u201crecession proof\u201d, it is more \u201crecession resistant\u201d. We take a look at the impact the current economy is having on real estate deal flow in the multifamily space and how you can still be successful in this market. \n\nFor more, visit: https://www.bluelake-capital.com/ \n\n\U0001d5de\U0001d5f2\U0001d606 \U0001d5e7\U0001d5ee\U0001d5f8\U0001d5f2\U0001d5ee\U0001d604\U0001d5ee\U0001d606\U0001d600:\n\n\u2022\tOverall, there's been a slowdown of deals, but prices are generally stable and we are seeing more off-market deals.\n\u2022\tDeveloping strong relationships and a strong brand are keys to keeping your deals active and filling your funnel. \n\u2022\tReturns are not what they were before; that's partially because the loan to value is lower and you need more equity to close deals. \n\u2022\tThe main thing is to adjust expectations and understand that, while returns may not be as high as they were before, they\u2019ll still be solid.\n\u2022\tOperationally, it\u2019s important to understand not only the strength of multifamily as an asset class but also the forces that impacting your yields. If it\u2019s financing and pricing, you should know up front. If it\u2019s increasing expenses because of inflation, then you should be able to make adjustments in your operations; it\u2019s different from how things were six months ago.\n\nAre you\xa0REady2Scale\xa0Your Multifamily Investments?\n\nLearn more about growing your wealth, strengthening your portfolio, and scaling to the next level at\xa0https://www.bluelake-capital.com/\xa0\nLearn more about your ad choices. Visit megaphone.fm/adchoices