Buyers fuming over real estate agent review ‘waste of time’

The lack of movement has left many in the industry frustrated, feeling as though they have wasted their time making public submissions which closed on April 1.

A report on the review was to be provided to government at the end of April, according to a government website, but is yet to see the light of day – even though the government announced $3.8 million in funds for an underquoting taskforce this spring.

The review was to look into a raft of issues in the market, including underquoting, where unrealistically low prices are advertised to get more buyers interested in a sale.

“The property market review was commissioned by the Victorian government to provide advice to government on additional measures that could best support fair and easy access to the housing market,” a government spokesperson said in a statement.

“Underquoting was identified as a key concern by the review – and a dedicated taskforce backed by $3.8 million has already launched in a blitz to combat underquoting and other breaches of consumer property laws.

“The government was considering the review’s findings alongside changing market conditions prior to caretaker [mode] – and will have more to say about this work if re-elected.”

The Liberal Party and Opposition Leader Matthew Guy were also approached for comment on the issue.

REIV chief executive Quentin Kilian said the lack of movement on the review was “very frustrating” for the peak body who had made a substantial submission.

“We provided government information and suggestions that would be good, not just for us, but the entire sector,” Kilian said. “We were told in June, then July, then October that it would come out …but it has not been released.”

Kilian said the underquoting taskforce was set up as a result of the report however investigators working through Consumer Affairs Victoria (CAV), were yet to be seen at any auctions.

“We’ve been told they’re using internal researchers looking at advertising and sale prices – it’s more analytical – but they didn’t rule out turning up to auctions,” Kilian said.

While underquoting was an issue in some circumstances, Kilian said there was a lot of education needed, not only of agents but also of the public.

“It’s always been about getting the definition through to the public about what underquoting is, rather than them just missing out on the property at auction.”

Underquoting can occur when a property is advertised at a price that is less than the estimated selling price, is less than the seller’s asking price, or has already been rejected by the seller. But it is hard to prove.

There is no requirement for a seller to disclose their reserve price to their agent before auction day, leaving buyers confused over why some auctions have a higher reserve price than the public price guide. A sale for thousands over the reserve price is not by definition underquoting, given it could be the result of competition from emotionally attached buyers.

Real Estate Buyers Agents Association president Cate Bakos said the government had leaned on some knowledgeable people who were frustrated the report had not been released.

She said they had come up with solutions to issues including underquoting and buying off the plan.