Consumer Affairs Victoria has been conducting a range of compliance and educational activities to help ensure homebuyers don’t experience the illegal practice of underquoting.
Our inspectors recently made unannounced visits to 29 metropolitan and regional estate agents’ offices to monitor their compliance with underquoting laws. We will take further action if any wrongdoing is identified based on those inspections and the information gathered.
We monitor the property market year-round and identify cases or agents to visit or investigate further based on factors such as advertising, sales data, and complaints from vendors, purchasers or the public.
We have taken a number of court actions as well as issuing fines for underquoting where we have identified underquoting breaches in the past and will continue to do so where required.
The COVID-19 pandemic has resulted in unusual conditions in the Victorian property market and it’s important for buyers, sellers, and agents to be aware of Victoria’s underquoting laws.
Underquoting can occur when a property is advertised at a price below the estimated selling price, the seller's asking price or a price that has been rejected as too low by the seller.
Estate agents must prepare a Statement of Information (SOI) for each property they are selling, which should include:
- an indicative selling price
- the three most comparable property sales, where possible.
There may not have been three comparable properties sold during the past 6 months (for metropolitan Melbourne) or 18 months (for regional Victoria) due to the impact of COVID-19 restrictions but agents must still ensure their estimated selling price is reasonable.
SOIs must be available in all internet advertising, open for inspections, and when requested given to a buyer within two business days.
The indicative selling price must be updated if a written offer within the range comes in and is rejected as too low. Estate agents must put any written offers to the vendor.
Agents who underquote risk penalties of more than $33,000 and losing their sales commissions. Underquoting can also result in penalties under the Australian Consumer Law of up to $10,000,000 for corporations and $500,000 for individuals.
To report underquoting contact Consumer Affairs Victoria via consumer.vic.gov.au/contact us.
More information about underquoting can be found at consumer.vic.gov.au/underquoting.