A Bill introduced to Parliament on 8 September 2015 aims to stamp out the practice by real estate agents of underquoting residential properties in order to attract interest.
The Property, Stock and Business Agents Amendment (Underquoting Prohibition) Bill seeks to prohibit agents from using phrases such as ‘offers over’ and ‘offers above’ in their advertising material.
If successful, the Bill will require Agents to include an estimated selling price in their agency agreement with the owner and will prohibit an Agent from representing to prospective buyers that the selling price is less than the estimation.
The Bill proposes that if an agent is found to have engaged in a prohibited underquoting practice, then a Court will have the power to order that any fees or commission earned by the agent be forfeited to the Property Services Compensation Fund.
This does not mean that an agent could be found to have engaged in underquoting in a situation where a competitive market has substantially driven up the price.
The legislation is seen to be necessary protection for consumers in the residential property market.
We will track the progress of the proposed legislation and keep readers updated.