Victorian Government to Increase Scrutiny of Property Agents Amid Underquoting Concerns
Melbourne, Australia - The Victorian government is poised to strengthen regulations targeting underquoting by property agents, a practice where properties are advertised at deceptively low prices to attract more interest. The proposed changes aim to increase clarity for buyers and hold agents more accountable for price estimations.
Currently, the real estate industry largely self-regulates, according to buyers agent Fahey younger. “We’re watchdogs of our own industry,” she says. “Most of the complaints come from othre agents, as it makes us all look bad.” She notes that repeat offenders are frequently enough known within the industry, but buyers currently have no way to verify an agent’s history of fines or disciplinary actions. Younger advocates for a public disclosure log of enforcement actions,stating,”Public disclosure would be the best deterrent,because a lot of this stuff happened behind closed doors.”
The move comes as concerns grow over agents exploiting loopholes in existing Victorian rules. Consumer advocate Neil Fotheringham believes increased regulation of comparable property prices, coupled with a dedicated investigative body, would be effective in curbing the practice. “Actually, having some scrutiny over that, some accountability for that, seems like a pretty good way to go,” he says.
Some experts suggest leveraging technology like RealAs, an algorithm-based property price predictor developed by RMIT in 2011, to assist governments in overseeing price estimation processes.
What Buyers Can Do
Prospective buyers are advised to rely less on agent-provided price guides and instead utilize automated property valuation tools. Experts recommend thorough research of comparable sales and consultation with trusted professionals.
“look at some of the ancient price guides in your area and the prices properties sell for, and factor that into your estimation,” advises property expert John Cooke. He also cautions against incurring legal fees on properties with little chance of success at auction.
In Victoria, buyers can review the comparative properties listed with the property to assess the realism of the price guide. Fahey Younger explains, “For the most part, that statement of data tells you everything you need to know about the current market price, what is fair and where it should be. And if thay’re above the range that’s quoted, then that’s going to be an underquoted property.”
Cooke encourages buyers to report suspected underquoting to relevant state and territory government bodies, noting that a lack of reporting contributes to the continuation of the practice.
