New underquoting laws that will heavily fine guilty agents, strip commissions and require price guides to be publicised on all homes come into force from the start of May 2017. The major reforms to the Estate Agents Act 1980, which are also backed by the Real Estate Institute of Victoria, will see agents fined up to $30,000 on each property they are found to have underquoted on.
Agents will be required to provide an “information statement” for each home they are marketing with an indicative price within a 10 per cent margin, details of three comparable sales and median price information for the suburb. This statement will need to be available on online property listings, at open home inspections and at the prospective buyer’s request.
Agents Have Nowhere to Hide
After underquoting legislation was introduced in NSW at the start of 2016, several agencies continued to underquote properties. When one of them was handed court summons, they responded by shifting the blame, claiming they were only following instructions from the owner of the property.
This excuse was regarded as entirely invalid. Fair Trading NSW cited the clear requirement for agents to adhere to the Property, Stock and Business Agents Act 2002 which states that “an agent must act in the client’s best interest at all times unless it is unlawful to do so”. The law trumps the client every time.
How Can Agents Keep Clients Informed?
It’s more than likely some homeowners won’t be familiar with the particulars of the new underquoting laws and as an agent, it will be your duty to explain to them when any suggestions they make contravene the legislation. If they push back, it might be time to give up the listing. The brand damage, hefty fines and possibility of losing your licence just isn’t worth the risk.
Be frank about the impact of underquoting legislation and what it means in terms of how a property can be advertised. Regardless of the reserve price, remember that you still have control over the price put on the agency agreement and the subsequent price advertised. Use the latest real estate software to help you present accurate information about property prices, comparable sales and median suburb prices consistently across all marketing materials.
Real Estate Bookings Can Help
We can offer you a simple and practical solution to remaining compliant. Our software makes it easy to build property profile pages with the information required by the new laws, which can then integrate into automated enquiry responses.
You can include price guidances in customised emails and even use our app at open home inspections to provide all necessary information to prospective buyers. Keep ahead in the new legislative environment by leveraging the latest technology to keep your agency compliant.