The letters, which are almost always prefaced with the “Dear Homeowner” clause, have proven to be popular in “high desired, high demand neighbourhoods”, reported Garry Marr for the Financial Post
“People in the trade of real estate on a full-time basis, this is one of the ways they mine for leads,” according to Kelvin Kucey, Real Estate Council of Ontario deputy registrar of regulatory compliance.
Kucey added that his agency receives approximately 25 to 30 calls every month from home owners complaining about these unsolicited expressions of interest.
Agents said that the practice allows them to streamline the process, as well as help out buyers in markets where supply is extremely tight.
“I have found sellers (say yes to the offer) because they have a price in mind that they are comfortable with and, if they can avoid the process of selling, they will,” said Sabrina Kaufman, vice president and salesperson with Slavens & Associates
“I’m not someone who is going to sit around and wait for product to come to me. My buyer list will just continue to grow,” Kaufman added. “Buyers are frustrated and want results. More and more agents have to go off market. You go into an offer presentation and five other people are there.”
Sotheby’s International Canada chief executive Brad Henderson argued that these signed offers are not the best way for real estate agents to go about resolving the dilemma posed by scarcity.
“I just don’t think it’s an optimal strategy for the seller,” Henderson said.
Real estate lawyer Barry Fish agreed, adding that sellers need to watch out for offers that might railroad them into a too-sparse timeline.
“If it’s not MLS, you are rolling the dice,” Fish said.
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The surging demand in the red-hot residential markets of Vancouver and Toronto has encouraged the emergence of a not-illegal but highly frowned-upon tactic: letters from real estate agents detailing unsolicited offers, complete with a home owner’s name and address as well as a purchase price.