According to the NSW Department of Fair Trade, “The underquoting laws are designed to ensure that buyers don’t waste money and time on property inspections, getting reports and attending auctions for properties that will likely be out of their price range.
An agent is underquoting the selling price of a residential property if they make a statement or publish an advertisement about its price that is less than their reasonable estimate of the property’s likely selling price.
To help protect consumers from underquoting, the law requires agents to do the following:
- make reasonable estimates of selling prices and never make a statement or publish a price lower than these estimates
- advise the seller of the evidence the agent relied on to make an estimate or revised estimate
- revise the estimated selling price if an agent becomes aware it has ceased to be a reasonable estimate, notify the seller in writing, amend the agency agreement and take steps to ensure they do not communicate any price information lower than their revised estimated selling price.”
The guidelines for agents are very clear about underquoting, so why is it still rife in NSW?
As buyer’s agents we see underquoting every day of the week. We understand that agents can’t always get it right, that’s unrealistic. However, there are three of four agents in Newcastle who are renowned for serial underquoting.
We’ve spoken to the department of Fair Trade about this issue and they tell us it’s difficult to prove.
However, NSW Minister for Fair Trading Eleni Petinos recently announced that she is going to be investigating the issue further and taking a hard stance against it.
“Understating the expected price of a property for sale by providing false estimated selling prices of the property completely wastes the time and money of potential homebuyers,” Ms Petinos said.
“Underquoting will simply not be tolerated. We will continue to investigate and penalise where false prices are provided to consumers.”
A special NSW Fair Trading task-force has issued 114 infringement notices over the last year totalling a quarter of a million dollars. The bulk of that — $200,000 worth — occurred in the past nine months.
Complaints about underquoting jumped significantly last year, with 329 reported in 2021 and just 97 recorded the year before.
To report underquoting call NSW Department of Fair Trade on 133220 or go to their website https://www.fairtrading.nsw.gov.au/