This Issue: What's Your Real Estate Investing Game Plan?

Your electricity might flow better through another socket

An old friend was working on Wall Street and not doing well. He looked worse - unhealthier and unhappier - each time I saw him, and it saddened me. I liked this guy, so I finally decided to tell him that he was beginning to look like a total loser. I hated speaking so harshly, but I really cared about him and wanted to help. When I asked him why he stayed on Wall Street, even though it obviously was not working for him, he explained that his family had always worked there and he felt obligated to continue the family tradition, even though it was killing him.

When I asked him what he liked to do, he told me he loved to tend the greens at his golf club. He knew golf courses, had a feel for them, and cared for them well. He also loved working outdoors and being in contact with people. I suggested that he look into the golf industry instead of continuing to suffer on Wall Street. I also pointed out that his unhappiness was probably taking a heavy toll on his family.

Breaking away was difficult, but he made the move. He had to swim upstream, in hostile waters, and against the stronger tide - his family’s and friend’s traditions and expectations. He went into the golf business, where be became extremely successful. When I see him now, he’s always beaming and looking healthy. He has a new lease on life and has become a different person because he had the guts to go against tradition, take control of his life, and change.

So if your life is not what you want it to be, don’t be afraid to ask yourself whether you’re doing what you want and what is right for you. Measure yourself against your feelings, ambitions and goals, not those of others. That might mean standing up to friends, family and colleagues who think they know what’s best for you. Plug into your own electricity. It might flow better through another socket.

In his book The Seven Habits of Highly Effective People, Stephen R. Covey observed that a lot of our success is built on the small habits that we cultivate daily. That principle applies to real estate investing too. If you observe successful real estate investors and developers, you will see that they have cultivated some highly effective habits too:

Habit #1: Being curious. Successful real estate investors hunger to learn something new every day. One day, they will learn all about a new kind of mortgage. The next day, it will be a new kind of insulation. Their learning never stops.

Habit #2: Staying flexible. Only supple people triumph in real estate, because things change so quickly. One year it makes no sense to invest in a certain city; the next year, it is hot. One year adjustable mortgages seem ideal; the next year, they make no sense. Inflexible, opinionated people cannot adapt quickly enough to survive. To win, you have to stay open-minded and agile.

Habit #3: Looking at properties. You can learn a lot about real estate by reading books or Web surfing. But you cannot learn everything that way. After all, it is called real estate because it is all about real things: land, concrete and wood. That is why top investors never stop looking at properties. Doing so provides information that they can never find in books. Is the ground in one part of town mushy underfoot, for example? Are houses made by a particular builder more solid-feeling than others? Nobody is going to tell you that kind of thing; you need to get out there and see for yourself.

Habit #4: Cultivating the gift of gab. Nearly all successful investors love to chat with everyone they see in the course of their days - with shopkeepers, pedestrians, police officers and virtually anyone else who can offer insights on what is happening in different communities. If you don’t like talking to people, you are not going to make it in the real estate business.

Habit #5: Reading real estate ads - obsessively. Your friends and family members might wonder why you sit there reading all those property listings every day. (Sometimes, you might wonder why you are doing it too.) But just as stock market investors pore over stock listings, successful real estate investors are addicted to property ads. Reading those ads daily, over a period of years, builds a broad knowledge base that no book could ever provide.

If this kind of thinking makes sense to you - and I believe that it should - I invite you to join us in Trump University’s Real Estate Investor Training Program. The time to start cultivating winning habits and knowledge about real estate is now.

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Would you be interested in that property? I know I would. If I were planning to go to some open houses on Sunday, it would be the first one on my list. I would get there at noon to make sure I saw it before anybody else did.

Why does that ad work so well? Why does it pull so much more powerfully than all the others that only list bedrooms and baths? It’s because that ad incorporates four critical factors known as AIDA:

Attention, created by a headline that trumpets benefits

Interest, sparked by a description of condition and affordability

Desire, caused by prized features and benefits

Action, offered by an open house and a number to call right away

To write a great ad, you need to know all you can about your ideal buyers - who they are, what they can afford and what they are looking for in a property. Your next step is to use a little creative flair to present that information in an AIDA structure.

Don’t forget that newspaper ads are still powerful tools to sell properties, even in our age of Internet selling. If you get the power of an AIDA ad working for you, you can get your properties visited - and probably get them sold - next Sunday afternoon.

Editor's note: To learn more about achieving success in the competitive world of real estate, enrol in The Real Estate Investor Training Program from Trump University. Classes are forming now.

“Should” is a dangerous word. If you use it in sentences like these, it could be doing you a lot of harm:

• “The house I’m renovating should sell for $450,000.”
• “My new product should make me $50 million a year after I bring it to market.”

When you start to use “should” that way, you’ve probably fallen victim to false optimism. It’s highly seductive. You want so much for that house to sell for $450,000 that you start to believe it really will. Or you want your new company to generate $50 million in annual sales, so you start to count on that happening.

It’s the kind of thinking that leads you to you overspend. You spend too much money when real estate investing, then you spend too much money to fix it up - and you never get your money back. Or you want to be an entrepreneur, but you pour too much money into your business start-up and it never gets off the ground.

What can you do to cure “should” thinking if it has lured you in? The first step is to admit that you have been counting on an unproven outcome. The second step is to get anchored in real numbers. What are houses really selling for in the town where you are investing, for example? Know that figure and work back from it. Or if you are starting a company, what are realistic income estimates for your first year, your second year, and beyond? Ride herd on the numbers and don’t let your heart get ahead of your head.

As our Chairman Donald J. Trump observes, cautious optimism is the key to success. You have to dream big, but verify your expectations against real-world facts and figures.

So work the figures without letting your emotions get in the way. You can get very excited later on when the money starts to pour in. But in the early stages, make sure the numbers work. If you do that, you not only “should” be a success. It’s really going to happen for you.

Editor's note: To make sure the numbers work on your real estate investments, you might need the skills that our students learn in The Real Estate Investor Training Program.