Sparrows and Starlings will kill other birds and their babies in order to take over the nesting site. If you find a box that looks otherwise perfect, you can drill holes like these yourself. Also a good bird box should have a roof or wall that can be unscrewed or unlatched and removed so that you can clean the box. A nest left sitting can attract parasites that make the box unattractive to prospective tenants, plus, a bird is more apt to go find a nice clean empty box somewhere rather than spend a day or two tearing up and discarding a filthy old nest. Generally you should clean out a bird box shortly after the family moves out.
Early fall is a good time to do it too.
Birds will actually favor a box that is somewhat weathered. Finally a bird box should have grooves, rungs, or steps embedded on the inside beneath the entrance hole. Growing baby birds will need these to clamber up to the entrance when a parent arrives with food. When mounting boxes on trees, many have had more success when the box is NOT on the main trunk. Boxes should be placed an adequate distance from each other and from your house.