Objections Overcoming Objections specific to Real Estate Joint Ventures

[Allie]

The path to success is littered with obstacles (cliche, but true) and one of the biggest obstacles as a Real Estate Investor is securing the $$$$$$ required to leverage our goals. For those of us who plan to pursue Joint Venture partnerships at some point, one of the biggest obstacle is the fear of not being able to answer an "objection" articulately and with poise. Maybe it`s just me but I wouldn`t be surprised if others feel the same way.

When faced with a question I do not know the answer to, I would tell the potential JV partner that I will get back to them, however, I would rather go into the meeting armed with a list of "rebuttals" to possible objections. An example of an objection would be "How do I know my investment is secure?" .....

By no means will it be possible for us to come up with a comprehensive list but I think discussing this topic will invaluable to the REIN members who are aspiring to grow their real estate portfolio beyond their own financial constraints.

I am wondering what "objections" or questions REIN members have encountered during their JV presentations and the best responses they have given to these questions. If hindsight is 20/20, please post those nuggets as well

If it`s easier for you to post questions than answers, please post anyway. The point is to challenge ourselves to see which questions we will be able to answer competently should we be put on the spot.

 

[cfehr77]

I`ve come across two objections since I started looking into real estate - 1) the market will continue to decline for a few more years and I should hold off until 2012 or 2013, and 2) being a landlord sucks!!

I didn`t have much of a response for the first objection because I think it`s true, and for the second it`s part of the game of owning property....highs and lows, just like anything else.

 

[JohnS]

QUOTE (cfehr77 @ May 6 2009, 05:12 PM) I`ve come across two objections since I started looking into real estate - 1) the market will continue to decline for a few more years and I should hold off until 2012 or 2013, and 2) being a landlord sucks!!


I`ll let other, more knowledgeable people deal with #1, aside from mentioning that their money has to go somewhere, and REI is still the best of all of the options.

As for #2, what about, "You`re right...it can. That`s why I`m the one who will take care of everything. I will (insert Thomas`s great list here), and all you have to do is sign your name on your cheque..."

To me, #2 just gives the perfect opportunity to showcase all we do as the RE experts.

Have a good one!

JohnS

 

[Thomas Beyer]

QUOTE (cfehr77 @ May 6 2009, 03:12 PM)
I've come across two objections since I started looking into real estate - 1) the market will continue to decline for a few more years and I should hold off until 2012 or 2013, and 2) being a landlord sucks!!



I didn't have much of a response for the first objection because I think it's true, and for the second it's part of the game of owning property....highs and lows, just like anything else.


re 1:



read this here ..



50 Year house price view: http://myreinspace.com/rein_members_only/Members-Only_Discussion/81-6621-50_Year_Calgary_House_Price_View.html



and I think it is NOT true .. we're close to the bottom in 2009 if not on bedrock right now !! There's quite a bit of evidence in both Canada and US that prices have firmed up .. of course some regions will be in the toilet for a few more years .. but tools such as the REIN Goldmine Scorecard or common sense location analysis would tell you to avoid those weak markets !



re 2: landlording takes work .. indeed .. a lot of hard work .. that's why we (the experts) take 33 to 50% of the profits to make your investment experience hassle free !! All you do is: sign a document and send one cheque .. while we toil for years !



The two main objection we have are



a) it is not liquid i.e. it is a 5+ year hold .. so we answer: indeed .. and ask: what % of your investments have to be liquid ? And: what % of your investment is liquid ? And then: WHY ? Even if you are 65 today not even 30% has to be liquid ! Most mutual fund advisers have done a great job selling equities/bonds/stocks which are liquid usually .. why does all your money have to be convertible into cash in a few days ? Equities, btw, do not give a great ROI anymore as we saw in teh huge correction in fall of 2008 (read this article here in National Post today .. bonds vs. stocks in 15 years have yielded THE SAME !!!)



http://www.nationalpost.com/related/topics...html?id=1481242



b) wow .. you take 40% (or sometimes 50%) of profit .. I could do it myself and keep a 100% of the profit .. and we say: indeed you could .. good luck to you .. and often a year or 2 the same folks come back and invest with us after they realize how much hard work it is to find locations, find sub-locations, write 12+ offers, get a decent property at a good price or good terms like a VTB, get a mortgage, manage the beast ... more on this here:



50/50 ` is this fair ? http://myreinspace.com/public_forums/Real_Estate_Discussion/62-2015-5050__is_this_fair_.html