In the competitive and often cutthroat world of real estate, the Victorian government is taking a firm stand against a deceptive practice that’s been causing headaches for homebuyers: underquoting. This tactic, which can shatter the dreams of prospective buyers, is now in the crosshairs of a dedicated taskforce determined to protect consumers and ensure a fairer property market.
Underquoting occurs when a real estate agent advertises or advises a property price that is lower than the seller’s auction reserve, the agent’s estimated selling price, or a price that has already been rejected by the seller for being too low. This misleading practice can lure buyers into thinking a property is within their budget, only to find out at auction that the true price is significantly higher.
The Victorian government’s crackdown on this ‘dodgy’ tactic is not just a promise but an active pursuit. Over 20 inspectors from the Consumer Affairs Underquoting Taskforce, alongside Consumer Affairs Minister Nick Staikos, recently conducted an Autumn blitz, attending 20 auctions in Doncaster and surrounding suburbs to check compliance with underquoting laws.
Since its inception in 2022, the taskforce has become a permanent fixture in the fight against real estate misconduct. To date, it has fined over 160 real estate agents and issued more than 220 official warnings for breaches of obligations, with fines totalling over $1.8 million. These actions underscore the government’s commitment to upholding the integrity of the housing market.
Underquoting has been a leading issue reported to Consumer Affairs Victoria, with more than 3,740 complaints from purchasers, real estate agents, and buyers’ advocates. Interestingly, over 30 per cent of these reports were made by real estate agents themselves, indicating a recognition within the industry that such practices are harmful and unacceptable.
The taskforce’s presence at auctions is not merely symbolic; officers actively check compliance with auction and sales rules, engaging with both real estate agents and buyers to monitor for potential underquoting. This hands-on approach is part of a broader strategy to make buying a home fairer and easier for all Victorians.
Minister Staikos has expressed a clear intent to eradicate the ‘dodgy behaviour’ of underquoting, acknowledging the undue stress it adds to the already challenging process of buying a house.
The government’s resolve is further demonstrated by the recent passage of the Consumer and Planning Legislation Amendment (Housing Statement Reform) Bill, which has increased the maximum penalty for underquoting to a substantial $47,422.
The new legislation also mandates training for real estate agents and property managers, ensuring that industry professionals are well-versed in ethical conduct and the legal requirements of their roles. This educational component is crucial in preventing underquoting and safeguarding consumer interests.
Under Australian Consumer Law, underquoting may violate prohibitions against misleading and deceptive conduct, as well as false representations. The Victorian government’s actions send a clear message that such behaviour will not be tolerated and that there are serious consequences for those who attempt to deceive buyers.
As a community of Australians over 50, many of whom may be considering downsizing or investing in property for retirement, it’s essential to be aware of these practices and the protections in place. If you suspect you’ve been a victim of underquoting or any other unfair real estate practice, it’s important to report it to Consumer Affairs Victoria or seek legal advice.
The state’s crackdown on underquoting is a commendable step towards a more transparent and equitable real estate market. It’s a reminder that, while the property market can be daunting, there are measures being taken to ensure that everyone plays by the rules, making the dream of home ownership a fair and achievable goal for all.
Share your experiences and thoughts on the government’s crackdown in the comments below. Your insights could help others navigate the complexities of buying a home and encourage a collective push for a fairer property market.
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