Today I was perusing the NextDoor.com newsfeed for the Ballard/Crown Hill neighborhood, and saw a question from a homeowner regarding the proliferation of letters she gets from developers and real estate brokers.
I answered it with this explanation:
I am a Realtor and have occasionally sent a letter to a property owner on behalf of a buyer. I have tried to create as personal a letter as possible and am currently working on one such project which is complicated but may be coming to fruition to the satisfaction of both parties.
First time homeowners, families moving up and people wanting to downsize are all having a difficult time with the transition as there is so little inventory on the market. Home owners who want to move are worried about selling as they are more worried about finding a new home. Additionally, interest rates are going up so those who are at 3.5% may need to go to 4.5% (generalistically).
That said, developers do target many properties in zoning that allows them to build the fourplexes as seen in Ballard. I researched one a couple of years ago on 24th, just north of 65th. The developer bought it directly for approximately 550k, took out a mortgage for over 1 million, and sold each of four for about 600k (I would have to do more research to find the exact details).
In a market such as we have in Seattle, we have far more demand than supply; one home in Broadview saw about 30 buyers through each open house and had 13 offers, despite needing all new windows, floors, cabinets, bathroom overhaul, etc.
Developers can make profits during this kind of a market.
Sellers can also make far more if they put the home on the market – many go up 100-200k. The home at 7750 9th Ave NW escalated:
List Pr: $575,000
Org LP: $575,000
Sold Pr: $665,000
Some of the home owners who receive these letters may not want to go through the process and see these letters as an easy way to move on.
Realtors will usually try to make the process as easy as possible by managing the details.
I could go on and on about this market as this is just the tip of the iceberg!
Meanwhile, know that many of the letters are from both developers and real estate brokers looking to buy either for development, investment or for bonafide buyers. Most real estate professionals will provide you with a free market analysis if you are interested.