Victorian homebuyers struggling to get into the market will be protected from underquoting real estate agents, thanks to new laws to be introduced in the Victorian Parliament today.
The Andrews Labor Government is cracking down on underquoting advertising – where an agent misleads a prospective buyer about the likely sale price of a property – under major reforms to the Estate Agents Act 1980.
Under the new laws, agents must provide prospective buyers with a comprehensive analysis including three recent comparable sales, an indicative selling price, and the median price for the suburb.
The new laws will also mean:
- Advertising price ranges of more than 10 per cent (e.g. $500,000-550,000) is banned
- Words or symbols in advertising such as “offers above,” “from” or “+” will be banned
- Advertising must be promptly updated if the seller rejects a written offer to purchase, or the agent’s price estimate changes
- Agents found guilty of underquoting could lose their sales commissions
- Agents have to prove on request from Consumer Affairs Victoria how they arrived at the estimated price
Real estate agents caught underquoting will face hefty fines, with new offences with penalties of more than $31,000.
The new laws are part of the Labor Government’s work to make the real estate industry fairer. The Government has consulted with the Real Estate Institute of Victoria (REIV), which has backed the reforms.
Consumer Affairs Victoria’s Task Force Vesta was established in mid-2015 and has examined around 1,400 sales files, with 13 investigations underway and one matter before the courts.
Quotes attributable to Minister for Consumer Affairs, Gaming and Liquor Regulation Marlene Kairouz
“Buying a home is the one of the biggest decisions Victorians will make. Prospective buyers expect and are entitled to a level playing field.”
“Victorian homebuyers deserve a fair go. This is about making sure they don’t waste time and money on properties they can’t afford.”
“These laws send a strong message to agents: think twice before you underquote properties to our homebuyers.”
Quotes attributable to Real Estate Institute of Victoria CEO, Geoff White
“These changes are a significant step forward, bringing consistency and transparency to the sales process in Victoria.”
Reviewed 19 August 2020