today we have an interesting video for you I am actually with our general manager Valerie chambers we are going to go over the differences in a house that was you versus just a house business that is usable that is functional hey guys James why's there are you team where's it both demise you guys are looking at these properties and I get it you're looking at your spreadsheets you're like okay my current rent is 950 a month if I spend an extra $6,000 I can increase my rent 60 bucks a month that doesn't pencil out to the best return on my investment but I want you guys to really start looking at the bigger picture when we're talking about real estate investing I want you guys to really see that it's not always about that specific menial small rental increase when you spend money sometimes it's about reducing your turnover which we know that turnover is a return killer guys not an extra $50 a month $50 a month is only $600 a year as you guys know whenever you talk to Valerie it's because there's probably a turnover coming and I know Valerie turnover costs are not a lot more than $600 is that correct that's correct as you know I'm Valerie chambers neck for general manager in Hilton life quick little story about the house we're standing in today I actually closed down this house yesterday so this is not a rental home this is my personal home I couldn't agree more Valerie gasps when we you know Valerie goes out she reaches document says hey you know mr. investor unfortunately your tenant is moving out here is the renovation cause it's going to be three thousand dollars to get a new tenant in this property we're going to continue to rent that property for 9:50 however on top of that three thousand dollars if you want to spend another five thousand dollars we can go with the high-end look and really get a high quality tenant and you guys are looking at Valerie you see if Valerie aren't there was like but how much does that gonna increase the rent isn't that their first question to you absolutely and that is the wrong question guys looking that battery and saying okay if I spend an additional five thousand dollars but it's only going to increase my rent a hundred bucks why bother well guys you're not bothering to do that to make an extra six hundred dollars a year that's not why you do it you're doing it to avoid the next email or phone call from Valerie telling you the family that you were renting your property to moved out look at this kitchen guys we have brand new shaker cameras we have brand new hardware stainless steel appliances beautiful granite countertops undermount sink this is totally different than a functional rental do you want a kitchen that when the family the tenants whoever it is walks into it they look at it and they're like wow this is where I get to live this is gonna be amazing or do you just want to provide these people something they go yeah I think we could live here this will be okay who do you thinks gonna move out sooner somebody that was just wowed when they walked into the property or somebody who said yeah this is the best available stay there until a better opportunity arises guys and you're gonna lose money when that happens every time do you want a family that's gonna stay here for five seven ten years that's how you make money in the rental business guys you guys are looking at your spreadsheets too much you're looking at it like Oh three thousand dollar renovation 950 in rent if I had another five thousand but only increase my property value $100 a month in rent that doesn't pencil onto the appropriate return gasps I said it before I'm gonna say it again spreadsheets don't rent properties tenants rent properties and tenants do not read your spreadsheets reverse-engineer it how do you get rid of turnover turnovers your return killer how do you eliminate your return killer take a look at Malory for instance Valerie bought this house in the same neighborhood that you guys are renting it because you were Wow just that feeling of just yes this is what I want to come home that what was your favorite part of this house undoubtedly open concept as a single mom I can both be cooking dinner in the kitchen the feeling I got walking into here is in stark contrast to and then you find yourself in kick with kitchen such as these similar house similar area similar runs lang comma exactly guys this this kitchen right here this is absolutely a functional kitchen will people rent this house yes will the owner get over $900 a month in rent absolutely but literally ask yourself do you feel the same way standing in this kitchen you fountain in Valerie's kitchen valve do you feel the same way no absolutely I'm not wowed by this kitchen guys and look I mean obviously you guys I don't unders of properties I manage millions of dollars worth of properties when I actually lined by any real estate but I would hey I'm wild by his money and I know that a house like this is gonna have a lot more turnover which is gonna cost the investor a lot more money so if you're like me and you're loved by money you need to do one thing and that's reduce your turnover just just look here right this cabinet is it functionally guest does it work yes but does it have you know a nice new modern color now this is a David wood color if you were building a new home or trying to buy a new home you know putting a picture of a house in a magazine this is not the color you would use this countertop it's just Africa it's just a green that's just no longer in style this the sink right here there's white sink with this faucet this is not what's in Valerie's house it had granite sink was under mount it was that nice large modern look at that beautiful backsplash this is just like a piece of vinyl backsplash like the space right here guys this is great space people are going to pay that hey but no one is oh look at the floor okay again see the floor functional yes is it horrendous absolutely not will it work of course but if we're going to beat down that turnover we need to give people the floor they think about when they close their eyes and make picture their dream kitchen this floor of this kitchen while functional as it may be this is not it and the layout of this home yeah it's okay but it's chocolate you know we want right into a wall Val in your house your house was originally kind of structured chalky like that but of course it's no longer like that right they opened it up a lot which again is the single mom is huge it's clean in here I don't have the same ability to keep an eye on them and make sure everything's okay while I'm cooking dinner similar to the bathroom functionality versus wow this bathroom it'll work wash means fresh 14th take a shower but there is no Wow here there's no stay power here there's nothing that makes me just want to make this my home this outdated vanity I'm the wall medicine cabinet light fixture the white tub surround it's just not wow it's not what I think about when I'm envisioning my dream home it's nothing like this can't you feel the difference already just being in here they all bathroom like what are you really gonna do saving money on a new vanity do you really think that $80 vanity that the previous owner bought from home do you go in 1995 is gonna make anybody proud to live there look at the vanity look at how this feels in looks both in person in video in pictures this is what people want to see and it's only about $300 guys the tub shower surround here okay instead of that same old tired one-piece vinyl kit you spend a few extra 100 bucks on these tiles and you're going to get people that are going to want to stay if you get a family to stay here for one extra a year instead of moving out you've already read the entire cost the floor look at this floor this is a brand new modern and updated floor you've got to give people what they want you're going to make that money back these are typically longer-term investments you can't just look at the immediate return what is gonna keep bodies in my units how do I avoid the inevitable turnover it doesn't matter who rented your property when someone moves out there will be a turnover cost a home does not look the same when someone moves out and then it goes empty and a new person sees it you're always gonna have to spruce it up so we need to cut out turnovers this is how you do it guys how you guys feel in balinese house versus how you felt in that other house how you feel in this bathroom Vince how your tenants are gonna feel how this looks in this video compared to how the other house looked in this video the tenants get that same feeling when they're inviting their friends and family over they need to give them something that they can be proud of you you produce that for them they will reward you by staying I want to hit it again spreadsheets do not rent properties tenants rent properties and tenants don't read your spreadsheets this is a people business guys it's not exactly a numbers business yes the numbers are important but the end of the day we are dealing with people you got to give people what they want as always guys I'm James wise if you enjoyed this video if you learned from this video please like the video follow us on the Holton wines YouTube Facebook pages we're going to be pumping out content like this I want to teach you people that you know how to grow your net worth with real estate investing if you have a property that you'd like to sell whether you're local here in Cleveland or you're out of state but you own a Cleveland property go ahead and reach out to hold wines we can produce a high quality video just like this we are the number one seller of rental proper in the entire Greater Cleveland area Cuyahoga County look up the statistics you will see that we are number one that is factual there's not candor that is not sales sizzle that is fact because we know what we're doing this is all we do James wise Holton wise real estate investing made easy beautiful brand-new modern knows right now the house [Laughter]