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Real estate brokers using letters to find sellers

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JOHN D. SIMMONS - jsimmons@charlotteobserver.com
In response to a shortage of homes for sale in the Charlotte area, some real estate brokers are sending letters to homeowners to see whether they may want to sell their homes to buyers who are already lined up. The Keller Williams broker Robert Dulin sent letters to all the condo units at Park Plaza, background, and found one who wanted to sell.

From south Charlotte to Lake Norman, homeowners across the region are opening their mailboxes to find notices with an attention-grabbing message: If you want to sell your house, someone may be ready to buy.

It’s not a new technique for real estate brokers. But it’s a tool they’re using more frequently these days as the supply of homes for sale remains stubbornly low across the Charlotte region.

Some brokers are sending letters to entire neighborhoods, telling every homeowner they have a client lined up. Other inquiries are more focused, targeting specific streets or even a specific house that a buyer desires.

Still other brokers have skipped the letters – instead knocking on a homeowner’s door to see if they want to sell.

It all underscores that Charlotte’s housing sector remains firmly a sellers market: Prices are rising, and inventory isn’t keeping pace with demand.

Many would-be sellers still owe more than their homes are worth, prompting them to wait for prices to rise further before they sell, agents say. Builders aren’t putting new homes on the market as fast as they did before the housing crash.

Meanwhile, buyers are ready to move ahead before interest rates rise further.

Colin Feehan, president of the Scaleybark Place homeowners association, said residents of the south Charlotte townhouse development received letters a few weeks ago from a real estate agent who had a potential buyer. Feehan said the person was interested in buying one of the development’s larger units, but none of those were for sale.

“This is the first time this has happened to us, these letters,” said Feehan, who has lived in the development for four years. Feehan recieved a letter but said he has no intention of selling.

Debe Maxwell, a broker/owner for Charlotte-based Savvy + Co. Real Estate, said some neighborhoods have been “inundated” with inquiries from brokers telling homeowners they have buyers lined up.

“I hear that from a lot of my clients that they’re saying, ‘Gosh, I get something almost every day from a Realtor inquiring about a vacancy in our neighborhood.’ They never know when to believe it or when not to.”

Supply shortage

The inquiries come at a time when the Charlotte region, like other parts of the U.S., has tight inventories of existing and new homes for sale, which is frustrating buyers and brokers.

In October, the 18-county region had a 5.3-month supply of existing homes for sale, according to the Charlotte Regional Realtor Association. A year ago, the region had a 6.9-month supply, down from 10.4 months’ worth two years ago. A widely accepted definition of a housing market in equilibrium is one that has a six-month supply.

Champ Claris, broker in charge for Lake Norman Berkshire Hathaway HomeServices Carolinas Realty, said underwater homeowners – those who owe more than their properties are worth – have no incentive to sell now. If they did, they might walk away with a loss. So they’re counting on prices to rise further.

“Prices, while they are on the mend, we’re not seeing in our region such a huge jump that (underwater homeowners) are all of a sudden OK,” he said.

Supplies for newly built homes in the Charlotte region are also low, according to Metrostudy, a company that tracks new-home construction trends. In the three months that ended Sept. 30, the region’s supply of unoccupied new homes was at 1.6 months’ worth. That category includes homes that might be under contract as well as those that haven’t sold.

Bill Miley, Charlotte market director for Metrostudy, said equilibrium for unoccupied new homes is a supply of two to three months. The current supply is the lowest it’s been since Metrostudy opened its Charlotte division in 2000, he said.

“There’s not enough finished homes out there that can close. We have an inventory shortage, really, in Charlotte,” Miley said, adding that builders are being conservative about housing starts after having to deeply discount an oversupply of homes as recently as 2010.

Letters ‘more prevalent’

Pat Riley, president of Charlotte-based real estate company Allen Tate Cos., isn’t surprised that brokers are letting homeowners know potential buyers are interested in their properties even if they’re not for sale.

“With a lack of inventory, it’s more prevalent,” he said. “It’s a smart tactic, because it serves their buyers’ interests well, and for the seller, it lets them know that there is a client out there.”

Robert Dulin, a broker for Keller Williams SouthPark, said he sent letters to every property owner in uptown’s Gateway Plaza and Park Plaza to see if they wanted to sell to his clients. The clients, a husband and wife, specifically wanted to live in uptown, he said.

Dulin said some condo owners responded, but they wanted more than the family was willing to pay or a different time frame. Another seller had an attractive price, and earlier this year the family closed on a condo in Park Plaza, he said.

Dulin said he can’t recall when he last sent such letters to potential sellers, but it was before the housing downturn, he said. The letters are becoming more common, he said.

“You do whatever it takes,” he said. “We are in an extraordinary time in the real estate market in the United States and locally.

“It’s a tough time for buyers right now. If you’re a seller, you are, as my grandmother used to say, in the catbird seat.”

Agents know they may have to cast a wide net with their letters, sending perhaps dozens before they get a bite.

Joan Zimmerman, who lives in the Eastover neighborhood, got a letter about a month ago but wasn’t interested.

“It basically said, ‘We might have a buyer for your house. If you’re thinking about selling, be in touch with us. We’ve got a lot of people interested in this neighborhood,’” she said. She threw the letter away.

Some agents aren’t bothering with letters. Abigail Jennings, president of Lake Norman Realty, said one of her brokers knocked on the door of a house that wasn’t for sale on behalf of a potential buyer.

The tactic worked, and the house sold to that buyer this fall.

It’s what Jennings expects of her brokers these days: “If it’s not out there on the market, then let’s go find it anyway.”

Roberts: 704-358-5248; Twitter: @DeonERoberts
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