I think perhaps it implies that the person hasn’t viewed the property in person, over having just viewed the photographs provided on the listing.

Someone who has viewed only the photos could be argued to have seen the property, yet still remain sight unseen of the property

In this context sight has a couple of meanings. The first is like the sighting of land from a ship. The sight of the house is a glimpse of it. The second is simply the condition of the house.

I might tell my kids, “I can’t stand the sight of your room right now.” Which means I am upset by viewing the condition of their messy room.

I would assume the phrase originates from "sight" as a noun.