A lot has been said in the press recently about changes to laws governing underquoting, but what does this all mean for buyers or vendors?
Buying a property is the biggest financial investment most people will ever make. When dealing in the residential property market, vendors and potential buyers should be able to expect certain standards to be met.
A review of the previous underquoting laws found that clearer requirements for agents selling property would better protect consumers in the NSW property market and would ensure that the laws reflect the expectations of buyers and sellers. In turn this will also ensure that Consumers now have greater certainty about property prices.
From the 1st of January 2016, real estate agents are now banned from stating or publishing a price for a residential property that is LESS than their reasonable estimate of the property’s likely selling price. This price must be recorded in the agency agreement with the seller.
If a price range is used, the highest price must not be more than 10 per cent higher than the lowest price.
Agents also cannot market a residential property for a stated price using vague terms or symbols such as ‘offers above’, ‘offers over’, ‘plus’ or ‘+’.
If a real estate agent’s estimated selling price changes because of new evidence, the agent must update the estimated selling price in the sales agreement as well as updating all advertising and marketing information materials. Therefore buyers may see advertised pricing of a specific property change whilst it is on the market.
