EP 58 - Tyler Sarter - Off Market Deals with Real Estate Wholesaling

Want to learn about real estate wholesaling and how it can boost your real estate portfolio? In this episode I'm joined by Tyler Sarter, co-founder of Promise Land Realty, who went from a corporate marketing job to great success in real estate. Tyler shares his journey, starting from his family's real estate background to building a thriving business. He talks about the key decisions and challenges he faced and how skills like strategic planning and team management from his old job helped him. Tyler also gives tips on building relationships and finding off-market deals. Learn why integrity and reliability are crucial in real estate, and get insights into managing transactions and offering fix-and-flip rehab loans. Tyler's advice for new real estate entrepreneurs highlights the importance of ethics and perseverance. This episode is full of practical tips and inspiring stories that show how to align your career with your passions and the benefits of starting early in entrepreneurship. 


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Transcript

Speaker 1: 0:45

Welcome back to the Money Focus Podcast. I'm your host, moses the mentor, and on this episode we're going to be diving into the world of real estate with Tyler Sauter, who's the co-founder of Promise Land Realty. He transitioned from a corporate marketing career to be a leading figure in the real estate wholesale market, so join us on this episode as we explore his journey, his strategies and his secrets to his success. Let's go. Thank you so much, tyler, for joining Money Focus Podcast. Really appreciate your time. The first thing I always ask my guests is to really just walk us through their career journey, professional journey and, in your case, how you started your company.

Speaker 2: 1:28

So the floor is yours. Yeah, absolutely. Well, thanks for having me. I really appreciate it. For me, the journey started back when I was a kid. Just to be honest, I was kind of raised in a real estate family, so to speak. My grandfather was really big here in Detroit as far as real estate and on the political landscape, so I was raised around deals, but not old enough to participate in what was going on, but I just always was around it my brother and I as well, who was my partner and as time went on, the family business kind of fell off a little bit, you would say, and I decided to pick it back up like around 2015 when I first graduated from undergrad and was working a little bit in the corporate world and decided that long term that wasn't really going to be the route for me, so I needed to start building my own business. And that kind of fell back on what I always was raised around and kind of took it, put a spin on it and made it my own Nice.

Speaker 1: 2:34

That's cool, that you were able to be around. You know real estate and entrepreneurship at an early age Because you know me. When I was growing up I constantly heard you know, get a job, get a job, get a job. But it's no shame in getting a job, but it's just cool. I wish it was a, it was a balance in my brain, because it's like a job or nothing.

Speaker 2: 2:55

That's all I used to hear. Yes, both of my parents were entrepreneurs. My dad's a dentist, but he had his own practice. Both my parents were entrepreneurs. They oftentimes still will try to project their fears on you based upon what their life experience was. So I always heard the same thing Get a job, get a job, get a job too, even though my dad was an entrepreneur. But these days he's come around a lot and he's understanding the vision now. So everybody goes through that when you're going out on your own for sure it can definitely be scary, for sure.

Speaker 1: 3:28

So, but you did mention that you were an undergrad. You went to college. What was your corporate career like before you?

Speaker 2: 3:35

made the shot Right. So for me, I graduated from undergraduate, I got my degree from Tennessee State University, the HBCU in Nashville, tennessee, and I was actually in like marketing communications. So my first job was working for the Pennsylvania Lottery in Harrisburg, pennsylvania. Like doing a lot of marketing work for them, but still that's when I started to explore real estate. I mean, I worked in advertising agencies. I made the transition over, I worked in financial services, so fintech as well, in a marketing capacity, but then I was able to make the transition into corporate real estate related roles. So I worked for a commercial real estate news company and that was kind of my foot into like using that as like my secondary education, like my second college, but in a professional way.

Speaker 1: 4:30

Yeah, that's, that's pretty cool. So while you were working there, what was the catalyst for you to really just say, hey, I want to make that jump and completely leave that corporate career though? Like, did you have a crazy meeting? You had the storm out, or was it? Was it peaceful when you actually left the work, the nine to five?

Speaker 2: 4:52

That's a great question, number one. But it's a multitude. It wasn't I could just put my finger on one specific thing. There was multiple incidents throughout the years. It's just for me it just felt unnatural. You know, I was fighting against what I was naturally supposed to be doing the whole time and I felt like, honestly, if I would have made the transition a little bit sooner, I could have been farther ahead. But I mean I've had, I mean, most multiple incidents, inconveniences, and just going through that having to play that whole game is just not for me, you know, it's just not for me. And no, no, not to anyone out there who has a job, I mean, as I worked for eight years in the corporate world, high level corporate world. So I mean it just gets exhausting after a while, just to be honest, after a while.

Speaker 1: 5:44

just to be honest, the word that comes up a lot. You know, I've experienced it. And then I hear from other folks that it can be draining. Yes, so I get it. But what's cool about when you do have a job and a corporate job, you do acquire skills that help you transition to be a full-time entrepreneur. So what about? Your corporate experience? Helped make that transition for?

Speaker 2: 6:11

you a whole lot easier, yeah, so for me, I was always paying attention to what was going on while I was there, even though, you know, I always had in the back of my mind my exit plan and my exit strategy. I think some of the most transferable skills were just paying attention to the planning of a corporation and how they plan for 10 years ahead and, you know, take, put initiatives in place to accomplish, to put them in position to accomplish goals that might be five-year goals, 10-year goals. The planning aspect from a business perspective was a highly transferable skill. The organization component, how the structures are organized, you know, the organizational chart, building out a staff, a team, learning how people work together, how different people have different skill sets. So, like the management perspective, and then just overall execution for me, just being able to execute within a set time frame, adhering to deadlines and, you know, always striving to present the best product or do your best work for sure. So all of those things translated to where I am now.

Speaker 1: 7:31

Those are important skills. So why not learn those skills? Why? And get paid, Don't, don't hate your job, you know. Just embrace your journey. Where you're at, you know, and if you have aspirations to be an entrepreneur, just really walk through each day and figure out, hey, what can I take from this? You know I got a paycheck, but also what can I take from this and incorporate into my business? That's really key, Absolutely yeah. So talk to us about your company, you know. You say you and your brother are partners, but what makes Promised Land Realty, you know, unique? How did it come about and what services do you provide?

Speaker 2: 8:12

So we're a full service real estate investment firm. That's how I would categorize it. I would say our biggest niche is off market investment opportunities in several markets across the United States. So it's like a great resource for a person who's looking to invest in real estate off market with better you know, more competitive prices. It's a low barrier to entry opportunity for people who are interested in investing in real estate. And then, furthermore, we offer connections to lending for real estate investment opportunities. We offer real estate education materials as well, so we're kind of like a one-stop shop for, you know, single family or multifamily real estate investing. Then we're branching out into some development opportunities as well.

Speaker 1: 9:05

And you said your opportunities. Is it across the country or is it primarily in?

Speaker 2: 9:10

Detroit. I mean, I'm born and raised in Detroit but I've lived and made relationships all over the United States. So we operate in a lot of major markets, detroit being one, baltimore, maryland being another, memphis, tennessee also being a major market that we operate in, st Louis, missouri, and we got stuff all over the place Philadelphia, new York, california. But I would say those three that I mentioned are our major markets right now, but you know, stuff comes across the desk all the time. The first three.

Speaker 1: 9:45

I think you said Baltimore, Detroit, memphis. Those are cash flow markets. I actually invest in Cleveland, oh yeah.

Speaker 2: 9:55

And I need to do something. We need to, I need to come.

Speaker 1: 9:59

Oh, yeah, yeah, yeah, I can. I can definitely talk to you about that. I live in Atlanta. My wife is originally from Cleveland, so you know we're a small mom and pop type operation but we do have residential, not commercial properties, but single family and duplex duplexes in the east side suburbs of Cleveland and I love those spots and but you do have to. When you said Detroit because I had someone on my show who was like don't invest in Detroit, you know what I'm saying it's like it's horrible. And you could easily say that about Cleveland, because there's some areas in Cleveland that I would love to invest in but it just would take so much capital, a lot of government intervention, just a united effort, to really make that worthwhile. It wouldn't be something I could do alone. Similar like that with Detroit, where there's pockets that you shouldn't, you know, put your eggs in that basket yet. Or is it like, hey, get in early while it's cheap, dirt cheap, and just wait it out, like what?

Speaker 2: 11:04

How does it work? The piece of advice OK, and this is my honest advice, unbiased opinion. I feel like you know there's pockets of every major city you know that are more risk averse than others. So you need to spend some time and really understand the culture of a city and the dynamics of the city before you decide to put money there. But a lot of the times it's not about the play that you run. It's about who you're running the play with. So you know you have to have the right people on your team, because you can run the same play with a different set of individuals and have a totally different result. There's going to be bad apples everywhere, but you are the person who has to vet the people that you're working with and that's the best piece of advice that I can give for any investors. Like be slow to hire, quick to fire.

Speaker 1: 12:00

That's true, very true. On the first part, it sounds like you guys offer that whole off market. How does that work for your business? Are you guys wholesalers in a sense, or do you work with wholesalers? Do you go to auctions? What is your?

Speaker 2: 12:16

acquisition strategy A multitude of ways. So we're wholesalers. We joint venture with a lot of other wholesalers across the country as well, but a lot of it is just relationships, really is, is comes from relationships and referrals. So that means just doing good business. When you get the opportunities, it leads to more business. It's like a domino effect. So I get calls from opportunities, just kind of attract after a while, after you've been doing it for so long. It's like I tell anybody who's getting started. It's just you just gotta put in the work you know 10,000 hours and what you acquire along that journey is that it's going to be what sustains you and brings you business. As long as you just do one in an ethical way, you know keeping your name good out here generally, things will work in your favor.

Speaker 1: 13:38

Generally, things will work in your favor. I had Chanel Wilson on the show recently. She's based out of Philly and she had mentioned that you know wholesalers when she first started. You know wholesalers would really love her because she was just a woman of her word, like you know, when she says she's going to close, she's going to close. Is that something that you see on your end, like you will. You know, bring deals to someone that you know for sure is going to close and not play games and stuff like that. Like what are some best practices for an investor when they're dealing with a wholesaler to improve that relationship?

Speaker 2: 14:16

Yeah, you got to deal with somebody who's and you can tell you don't know. You got to move with people who are on the same frequency as you and moving with the same urgency as you. But I mean time is money. I can't stress the importance of time is more valuable than money, because time you cannot replace the commodity you cannot replace. You can replace money, but time and then real estate goes in cycles. It takes time to get these deals done. It's not like we're going under contract today and closing tomorrow. Oftentimes a lot of these deals with all type of stuff you go through while a deal is in escrow. You could be anticipating a 15-day close, and that stretches all the way out to 45. So time is the most valuable thing. Don't let anybody play with your time.

Speaker 1: 15:09

When you guys acquire or put homes and properties under contract for someone to because you mentioned something about a lending arm or some type of financing. Can you kind of expand on that a little bit Like so, if I'm an investor and I'm interested in the property that you guys have acquired, what services exactly do you offer? Do you partner them with like a broker, or is it something you do?

Speaker 2: 15:33

in-house Both. Actually, if you're interested in doing, for example, a fix and flip rehab loan, there's products out there that we can connect you with that will give you 100% of the rehab costs, 80% or 85% of the acquisition, and that's pretty darn good I mean, depending on credit score, obviously and that's really easy to get funded within you know, 10 days for a project, as long as it meets the qualifications of the lender, and there's multiple different lenders that we could shop the deal to, so you have options as far as you know. Interest rates and stuff like that but yeah, that's the lending arm. Interest rates and stuff like that but yeah, that's the lending arm. We have an application on our website as well promisedlandrealtyatrlccom, as well, as our deals are always updated every time. We get a new deal, which is pretty much every day to two days updated on the website, so that's like the resource you know for everything.

Speaker 1: 16:32

So if I'm interested, I go ahead. I go to your website, I look at your deals and say, man, this will work. I reach out to you and then from there it's just a matter of just you know, well, do I have cash or what type of funding or whatever, and you guys can help with that?

Speaker 2: 16:50

And then boom, you close. Yeah, we try to be as vertically integrated as possible to help people streamline the entire process from contract to reselling After you've completed the rehab. I'm a licensed real estate agent as well in Georgia and Michigan, so I definitely love that Atlanta market down there. I lived there for six years. I'm in Atlanta. Yeah, I lived there for six years. I'm in Atlanta, man. Yeah, I lived there for six years, so I loved it down there.

Speaker 1: 17:20

Gotcha gotcha. Well, I'm in Gwinnett County like far in Gwinnett Up north. Yeah, northside, cool, cool. What would you say as far as, like, the future for your business, because you said vertically integrated? The one thing I didn't hear was property management. Is that something? Do you have any relationships or PMs that from out of state that you can say, hey, well, tap into this one, or is that something you guys don't?

Speaker 2: 17:50

touch at all. Yeah, so I have. In the past I have managed properties for, especially here in Detroit, we have a lot of out of the country investors because when the you know, the real estate bubble burst way back when 2000, that was, a flood of international investors came and acquired properties in Detroit, people from Australia. I work with investors from Australia, Italy, obviously, Canada, a lot of Canadians. Yeah, I'm practically in Canada, yes, like Canada. But yeah, I have offered property management services in the past for those situations.

Speaker 2: 18:28

But to be honest, that's not really where we want to go in that direction. I think property management is really valuable. You know it's valuable, there's money to be made in it, but it requires a lot of time and intention and you need a lot of units to make it make sense. If you think about your only collected 10% of given said rent for the month, that means if the rent is what $1,000 a month, you do the math on that. So you would need to manage a lot of units. So that's just. We'd rather use our energy and some other arenas. But I do have great relationships with some property managers across Detroit. That's very valuable for Detroit as well, because you need somebody who knows these neighborhoods and, once again, knows the dynamics of the city and knows how to navigate.

Speaker 1: 19:22

Do you ever run into any issues where certain property managers won't even manage a property in Detroit because of you know the area might be in fact, or something like that.

Speaker 2: 19:33

Yeah, you run into those. You run into those situations. But what I can say, Detroit is a unique place with a lot of culture and we're definitely next as far as we're on the rise. You know it's the trend is there is not going down anytime soon. So it's like you better ride the wave while it's on the way up, because it's not coming back down. At this point I'd like to say the trajectory of the city is rapidly moving in the right direction.

Speaker 1: 20:07

I hope so, you know, and y'all can bring some of that that wave over there to Cleveland my properties can appreciate too. Cleveland is a great market. I've been to Detroit and not every part of Detroit is what people think. There's a lot of beautiful areas in Detroit and I guess the outer suburb area is really, really nice. I was impressed and I just think home affordability I think the Midwest is just, you know, people are going to have everybody can't live in Atlanta Like.

Speaker 1: 20:36

I moved to Atlanta in 2000. It was very much affordable then. I was 16, 17 years old, so it was like, you know, I had an apartment when I was 18. It was like probably so cheap, right, those days are over. Like, those days are over in Atlanta. If people want to, you know, really get something of substance, a nice place to live, they really want to have to go to more affordable areas and you know, I think the Midwest is just prime for it. That's why I comfortably invest in Cleveland, because the infrastructure is set up for more people to move back. So traffic is still pretty easy. So I think we can accommodate more people up there. The buildings, the history, everything is really beautiful up there and it's very similar in Detroit, so hopefully it comes back yeah for sure it's on its way.

Speaker 2: 21:30

It's not a hopefully. It's already happening. It's like, if you don't get it now, forget about it, gotcha.

Speaker 1: 21:37

For for someone. Let's take the for me to take the investment hat off. If, if someone was interested in, like, being a wholesaler or starting a real estate investment firm like you have, what are some skills that you think they would need out the gate? Because I hear wholesaling. A lot of people say, hey, you don't need any money to make money in real estate. And after you talk to them a little bit you uncover they're talking about wholesaling. Is that really true, that you don't really need any money, you just need hustle or whatever? Can you kind of talk us?

Speaker 2: 22:12

through that, yeah, I mean. But that with any business, that only is going to take you to a certain point, right Like you can deal with. The goal is to not stay there. Yeah, you can wholesale for a while and build your foundation, but eventually you need to get in the game. You need to own something, and that's going to require capital. But wholesaling, yes, is definitely the game. You need to own something and that's going to require capital, but wholesaling, yes, is definitely the foundation. It's the easiest, lowest barrier to entry into making money in real estate with relatively no capital of your own out of your own pocket, you know. But it's not as easy as people are making it seem out there. As a wholesaler, you're going to run into a wide range of characters along the way, people that you deal with property owners, buyers, sellers, other wholesalers. It's a whole dynamic to it that is not just cut and dries, it may seem. You need to really understand psychology, really to be a successful wholesaler. You know they'll understand how people think.

Speaker 1: 23:20

You know, I know I've been talking a lot of industry jargon and stuff like that. For people who have never heard of the concept of wholesaling and for real estate, can you explain it as if you were talking to a fifth grader? Yes, what exactly it is?

Speaker 2: 23:36

Yes, a wholesaling is normally done off market, which means off the multiple listing service, which means off the multiple listing service, so deals that are off market, where a person basically brokers a deal or middleman to deal between a buyer I mean an owner of a property and a buyer. So how it actually works is you would establish a contract with a seller, we agree upon a certain price, and your contract would have to have an assignability clause in the contract that would allow you to actually sell your rights. You're actually selling your rights to the rights to your contract to an end buyer who then acquires the property. So, if that kind of makes sense, that's how it works. So you put a property under contract and sell your contract to the buyer for your fee that you make in the middle, which is your wholesale fee I reach out to you.

Speaker 1: 24:37

We agree to a price of $100,000. So that's our agreement. So you're satisfied. I'm going to buy your house for $100,000. But there's a clause that says you said it's called an in-buyer clause, yeah, so it's called an assignability clause.

Speaker 2: 24:59

Assignability clause equitable interest in the property, which allows you to market the property for sale as a part of our contract. So then you will take your say hey, I have this property. I believe I got it under market value at one hundred thousand. I'll say this property for one hundred and fifty thousand, and then that fifty thousand is yours than 50,000.

Speaker 1: 25:26

And then that 50,000 is yours.

Speaker 2: 25:28

Scott.

Speaker 1: 25:29

Man and yeah, I mean so can. Conceptually, yeah, that that sounds great, it sounds easy. But what you were talking about psychology, I mean just getting someone to agree to it, I'm sure the tactics on how, because again, it's off market. So these are people that are not waking up saying I want to sell my house. You know you're contacting them, kind of cold, saying, hey, I want your house, can we make a deal? So you got to work through that. So I'm sure it's multiple contacts.

Speaker 2: 25:57

Yeah, it's being a good negotiators, having good negotiation skills and then overcoming objections, as well as a big part of it, you have to make people you know see the vision. You know what's in it for them, you know, achieving a fast sale, not having to pay in a seller's position, not having to pay realtor fees, because on market transaction the seller, you know, traditionally pays both their agent fee and the buyer's agent fee. So you have to be able to overcome objections and get the ink dry on your contract. But it just comes from repetition, you know, and learning along the way.

Speaker 1: 26:36

The one thing I'm always curious about for that wholesale process is let's just say you lock it in and you say you're going to close in 30 days. Let's just say you lock it in and you say you're going to close in 30 days, but if you don't find a buyer in 30 days, do wholesalers just pretty much say I'm just going to have to buy it, or do you kind of, you know, ask for more time to close? What do people mostly do.

Speaker 2: 26:58

What you should do is actually work backwards. I work backwards is actually work backwards. I work backwards. So I deal with the buyers first and identify what types of properties they want to buy. Then I go find those properties. So it's more beneficial to you and you'll have a much higher success rate if you identify the buyer first and just go find what they want to buy, as opposed to finding a seller and hoping that you can find a buyer at the end.

Speaker 2: 27:33

But to answer your question, you should always put two clauses in your contracts as well. This will help a lot of people. Your contract shall always number one, be subject to satisfactory inspection and number two, you can always throw this in there subject to partner approval before closing. So as long as you have a due diligence period of inspection period in your contract and you don't, if you don't find a buyer by then, you kind of have a how. But yeah, the object is to not get caught with a property or in breach of contract. So have to be kind of savvy and that also comes with experience as well.

Speaker 1: 28:19

That's definitely interesting. So you know it can be done. Wholesaling, you know can can be lucrative, sounds like, uh, but it's not easy to let people pull, you Get rich quick.

Speaker 1: 28:31

screams are for the infomercial you know, for the infomercials, that's right, that's right. But again, like, yeah, if you get good at it. I mean finding properties off market or just finding properties in general below market value. It's just just, it's huge, you know. So you, you did mention that you know wholesaling is a good starting point, but at some point you have to own. So do you personally? You know own properties and if so, can you talk a little bit about your portfolio?

Speaker 2: 29:01

Yeah, so I started off. I bought my first rental in a suburb of Michigan called Royal Oak, probably 2017, two years after I started wholesaling. So it took me two years before I could make my first investment property. I rented it out, actually in a very unique situation, through AAA. Insurance was paying for someone who had to, you know, get replaced. A tree fell on their hall, so I was getting paid directly from the insurance company, which was great. Didn't have to chase down any rent man. I recommend, if there is a way for people who own real estate to connect with insurance companies, that's almost better than Section 8. But, moved on from that point, did some properties that I held for a while and then let them go, flip them, but now more so I'm focused on different types of not the traditional real estate portfolio that you would think of. I tend to think a little bit outside of the box. I actually liquidated a lot of my assets to pivot in the direction of stuff like assisted living facilities, halfway houses.

Speaker 1: 30:17

Yeah, I've heard great things about those. I got someone on the show you got to watch that episode. I'll send it to you personally when you come out.

Speaker 2: 30:24

I'll definitely do all you personally. When you come out We'll haul the game on that. But yeah, there's a lot of government money out there for those types of properties. I'm more so liking to have my money guarantee, chasing down a tenant or you know someone chronic late payments, because, especially if you have properties that are financed, you don't want to put yourself in a bad position where you become a slave to the bank. So there you go. I want to be in a position where I know my money is coming on this date. No if answer. But, and I think like government programs and stuff like assisted living facilities are a little bit out of the box, but you know, two asset classes people should be taking a look at.

Speaker 1: 31:13

I'm definitely a fan of government programs to. All of my rental units are Section 8. And I try to encourage people to really look into Section 8 because you can do it. You can do it the wrong way too. You know what I'm saying. So you got to know how to do it the right way. Yeah, it's a headache, you know. Sometimes they nitpick on inspections. Yeah, they take forever to approve a tenant. But once you get them in there and you get the right tenant and the right property, they don't leave Nope, and that money just constantly come in. So I'm with you a thousand percent on that. Yeah, a thousand percent, you know. Close this out. What final thoughts or advice would you like to give to the audience? And also let us know how we can reach you, your company. Shout out your website again. Also your social media. So I just really appreciate you and the floor is yours man.

Speaker 2: 32:06

Thank you. Well, man, you guys can definitely get in contact with us through our website, promisedlandrealtyllccom. If you have any questions or want to find out about any properties, you can email us directly at investments at promisedlandrealtyllccom. Our Instagram is promisedlandrealty and we're also on Twitter at promisedlandreai. We'd love to get in contact with you. We'd love to get some deal done, some deals done with you guys out there. I guess, just to wrap up, one piece of advice that I could give anybody who's on their journey of just self-improvement or, you know, entrepreneurship, whatever the case may be, is just what you learn along the journey, is the reward, not the final destination that you have in your head. So it's never easy, but stick with it, and you know what I'm saying. Move with integrity and you know, be ethical in your dealings and good things will happen. You know you do good. Good will follow you.

Speaker 1: 33:14

Sound good. Sound good to me. So you know I appreciate you, tyler man. You got a great business. You and your brother are so cool that you guys are partners and keeping that family tradition rolling Gave us some great insight on wholesaling and just how your vertical integrated business operates. So really appreciate you, man. So you want to close this out? We're out, thank you, Thank you. You.