New real estate agent underquoting laws
Real estate agents will face much tighter underquoting laws next year, in a move by the state government to clamp down on underquoting by estate agents.
The way real estate agents advertise properties and their prices will be altered drastically.
What will be banned from early next year?
- Symbols like “$900,000+”
- “Offers above $900,000”
Estate agents will only be allowed to advertise a price range within 10 per cent.
For example – “$900,000-990,000” – and agents will have to prove to Consumer Affairs Victoria on how the estimated price has been derived, on request of Consumer Affairs Victoria.
Agents will also have to provide potential buyers with information regarding three recent comparable sales within 6 months and 2 kilometres of the property.
Prices advertised for the property will also have to be updated when the agent’s estimated price of the property changes or when a seller rejects a written offer to purchase the property.
If found to have underquoted, agents can lose commissions and be fined up to $31,000.
In making these new laws, as well as consulting heavily with the Real Estate Institute of Victoria, the Government says these changes will give prospective buyers and sellers confidence in how property transactions occurred, and will give both buyers and sellers the same information, without discrepancy.
The REIV says that 90% of the 2250 offices that are REIV members operate where underquoting is non-existent.