A BALNARRING real estate agent is happy about changes to the Underquoting Act which came into effect last week.
“We’ve been pushing for the changes since 2008,” Coast Real Estate agent David Wright said.
“We’ve been in direct communication with the Minister for Consumer Affairs about them.
“We think it’s about time those agents who are manipulating the price by using price plus, negotiable over, offers over, or buyers starting at, get hauled in.
“We’ve been using a trusted and compliant Price Ranger strategy since we started selling around the Western Port area 10 years ago.”
The new laws apply to sales authorities signed on or after 1 May. Those signed before then do not require the agent to prepare a statement of information for the property, but any prices advertised on or after that date must adhere to the new advertising requirements.
The new rules stipulate that an estimated selling price must be reasonable, and take into account the sales of three comparable properties.
An agent’s estimated selling price must be included in the sales authority, and in the approved form. It may be a single price – for example, $500,000, or a range of up to 10 per cent – for example, $500,000 to $550,000.
If an estimated selling price changes because it ceases to be reasonable, the agent must inform the seller in writing, update the sales authority, and update the advertising.
“The most important thing is transparency,” Mr Wright said.
“We deal with the largest purchase that most people will make and we need to disclose as much information as we can so that potential buyers can make an informed decision,” he said.
“Some agents might say, let’s blow them away [with a low-price estimate] but they might not realise that they may be putting their clients in a position where they can be fined up to $200,000 [for breaching the underquoting laws].”
A shortage of houses for sale now was exacerbating the problem because most properties would be selling at the top of their range,” Mr Wright said.