I was at a recent Path to Profits workshop with Bob Leonetti and Jayme Kahla and asked to participate in a training session instructing students how to buy properties sight unseen. I had just optioned three properties without personally viewing them and Bob wanted me to share how I did this.

Following are the steps to buying properties sight unseen, not blind:

1. Identify your outside market. This could be an area you used to live in or know well. I wouldn't invest in an area I knew nothing about. Things to consider about an outside market include population, demographics, job growth and income.
2. Determine medium property value. Go to Realtor.org to identify medium property values in your outside target market. Remember the golden rule: your cash price is 70% of ARV. I actually use 65% of ARV in smaller metropolitan markets.
3. Search available properties. There are numerous property search sites available: REOs on Bidselect, Realtor.com, Craigslist, Postlets for starters. Use key words such as investor, wholesaler, deal, motivated seller to assist in your search.
4. Determine property value. When you find a property, you need to determine its worth. The best way to accomplish this, and I'm not saying this just because I am a licensed real estate agent, is to use an agent. You can use Realtor.com to find agents in your target outside market to assist you. This technique absolutely works. My 15 year old son recently used my Realtor.com campaign and had several out of area real estate agents offering help within minutes.
5. Perform due diligence. The real estate comps will show you price range, days on market and basic important information. What the numbers miss is some important information like where is the property situated within the community? Proximity to big box stores, schools, grocery stores? Google Earth is a cool program that will let you have a birds eye view of your subject property. Your real estate agent can also help in determining property condition conformity.
6. Determine your exit strategy. What exactly are your plans for this property? I like to have at least 2 exit strategies. There are several options available. Wholesale: You can wholesale the property to another investor for quick cash; Buy and hold: You can buy and hold, putting the property into your portfolio and create cash flow from rental income. You can buy and hold and create quick cash and cash flow through a lease option; Owner finance: You can sell the property by offering owner financing for quick cash through a a down payment, cash flow through monthly payments, and future profit when the loan is paid off; Retail buyer: You can sell the property to a retail buyer and cash out. Now you are armed with the appropriate information and can structure the deal for the seller.
7. Control property. Negotiate a deal with the seller. You can control a property through a purchase contract, an option or a non-exclusive option. I used a non-exclusive option to control the 3 properties mentioned earlier.
8. Market the property. Now that you control the property, it's time to implement your exit strategy. You can advertise the home for free on Postlets, Craigslist, your Real Estate Investment clubs and Meetups. All have buyers and/or tenants looking for properties, and are usually free to advertise!
9. Field offers. All your marketing should generate multiple offers on your various exit strategies. If they inquire about leasing, find out if they can qualify to purchase the home. You can always move them to owner financing and have less property maintenance. If it's a wholesaler, I make any wholesale fee non-refundable. Determine which offer best meets your needs on the property.
10. Close. I love closings. They mean money in my pocket whether I'm buying or selling. You don't have to be at the remote closing physically. The title company or escrow agent can arrange for a mail out. Just understand that a few days may be added to the closing process to accomplish this.

Happy hunting!