How I Bought a Property Sight Unseen for the First Time

How I Bought a Property Sight Unseen for the First Time

2 min read
Sterling White

Sterling White is a multifamily investor, specializing in value-add apartments in Indianapolis and other Midwestern markets. With just under a decade of experience in the real estate industry, Sterling was involved with the management of over $10MM in capital, which is deployed across a $18.9MM real estate portfolio made up of multifamily apartments. Through the company he founded, Sonder Investment Group, he owns just under 400 units.

Experience
Sterling is a seasoned real estate investor, philanthropist, speaker, host, mentor, and former world record attemptee, who was born and raised in Indianapolis. He is the author of the renowned book From Zero to 400 Units and the host of a phenomenal podcast, which hit the No. 1 spot on The Real Estate Experience Podcast‘s list of best shows in the investing category.

Living and breathing real estate since 2009, Sterling currently owns multiple businesses related to real estate, including Sterling White Enterprises, Sonder Investment Group, and other investment partnerships. Throughout the span of a decade, he has contributed to helping others become successful in the real estate industry. In addition, he has been directly involved with both buying and selling over 100 single family homes.

Sterling’s primary specialities include sales, marketing, crowdfunding, buy and hold investing, investment properties, and many more.

He was featured on the BiggerPockets Podcast episode #308 and has been contributing content to BiggerPockets since 2014, with over 200 posts on topics ranging from single family investing and apartment investing to mindset and scaling a business online. He has been featured on multiple other podcasts, too.

When he isn’t immersed in the real world, Sterling likes reading motivational books, including Maverick Mindset by Doug Hall, As a Man Thinketh by James Allen, and Sell or Be Sold by Grant Cardone.

As a thrill-seeker with an evident fear of heights, he somehow managed to jump off of a 65-foot cliff into deep water without flinching. (Okay, maybe a little bit…) Sterling is also an avid kale-eating traveller, but nothing is more important to him than family. His unusual habit is bird-watching, which he discovered he truly enjoyed during an Ornithology class from his college days.

Education
Sterling attended the University of Indianapolis.

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Have you ever bought property without seeing it in person first?

Buying real estate sight unseen — and especially out of area property without going there first — is becoming increasingly popular again. For many, it is absolutely needed in order to find value, to land good deals that make sense by the numbers, and to diversify. Some are still scared of taking the leap. Others have been making a mint by doing it for years. Here is how my first sight-unseen deal went.

First off, let me say that if I wasn’t local, I wouldn’t have done this. My partner and I heard of a local real estate auction. There was a total of 65 properties that were being sold off. We were able to get ahold of the list. We drove areas and neighborhoods and compiled a shortlist of about 12 properties we were interested in after driving all of them. No one was able to gain access to the properties in advance. You simply had to drive by, even if they were vacant.

Bidding Wars

When I tell you it was a bidding frenzy, it was crazy. There were real estate investors who came from out of state, and some were paying almost retail for some of these properties that needed work. It can be easy to join the frenzy, but you have to stick to your number. It’s easy to join the crowd, but you don’t want to end up getting stuck with a property that you overpaid for and end up regretting it for years.

Related: I Almost Bought Properties at Auction: Here’s What Stopped Me

The Surprise

There was a property on the list that wasn’t formally on there. We hadn’t gotten a chance to drive by it, but we knew the area. We pulled up an image via Google. The image showed it needed work (of course). We ran the numbers and came up with a conservative offer price. We managed to land the winning bid. At this point, my partner and I began looking at each other like, “What the heck did we just do?!”

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Why it Worked for Us

Even for the properties that were occupied, we went super conservative on our numbers. We planned for the absolute worst case scenario. We went in with the anticipation that each property was a “gut to studs” renovation job on the interior. Fortunately, that wasn’t the case for any of them.

Related: How (and Why) I Offer on Properties BEFORE I Ever Step Foot in the House

After the Purchase

We went in and renovated the house. It took a lot less time and money than we anticipated. We were actually approached by several parties to purchase the property in as-is condition due to the upswing of the neighborhood. However, at that point in time, plans were to hold onto it for the cash flow. So far, everything has worked out perfectly.

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Summary

It worked out for us. We will probably do this again. However, we will only do it when we know the area and values and have run the numbers and made similar offers to ensure we can be profitable, no matter what work needs to be done inside.

What have your experiences been with buying property sight unseen?

Let me know your stories with a comment!