{"id":8726,"date":"2018-06-08T04:14:48","date_gmt":"2018-06-08T04:14:48","guid":{"rendered":"https:\/\/amazingproperty.com.ng\/blog\/what-you-need-to-know-about-underquoting\/"},"modified":"2018-06-08T04:14:48","modified_gmt":"2018-06-08T04:14:48","slug":"what-you-need-to-know-about-underquoting","status":"publish","type":"post","link":"https:\/\/amazingproperty.com.ng\/blog\/what-you-need-to-know-about-underquoting\/","title":{"rendered":"What you need to know about underquoting"},"content":{"rendered":"

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Most homebuyers are familiar with the phrase \u2018underquoting\u2019 \u2013 a practice carried out by real estate<\/a> agents while marketing a property in order to attract a larger pool of prospective buyers and create a greater sense of competition for the property.<\/strong><\/p>\n

The majority of agents act in good faith and take a far more honourable approach to marketing properties, however unfortunately \u2013 and despite recent reforms put in place in both New South Wales and Victoria to crack down on underquoting \u2013 it still happens within Australia\u2019s real estate industry.<\/p>\n

Underquoting, also referred to as \u2018bait pricing\u2019, creates frustration among both parties, but particularly buyers who get their hopes up about buying a property they think is within reach, only to be outbid or disappointed at auction.<\/p>\n

\"QUEENSLAND<\/p>\n

Underquoting laws are now in place to help ensure homebuyers don\u2019t waste time, money and a lot of effort. Picture: AAP\/Glenn Hunt<\/p>\n<\/div>\n

Cracking down<\/strong><\/h2>\n

Regulating underquoting is the responsibility of the consumer body in each state, for example NSW Fair Trading in New South Wales and Consumer Affairs Victoria (CAV)\u00a0in Victoria.<\/p>\n

Leading the way, NSW Fair Trading introduced new underquoting laws applying to the sale of NSW residential properties back in January 2016.<\/p>\n

Thanks to the reforms, real estate agents<\/a> in NSW must now quote prices within 10% of the lowest figure, which helps ensure that homebuyers are not mislead to invest in a property that is out of their price range. Agents who do underquote may not only lose their commission, but they may also face fines of up to $22,000.<\/p>\n

Additionally, advertisements that feature the terms \u201coffers over\u201d or \u201coffers above\u201d are now prohibited in NSW.<\/p>\n

CAV introduced a raft of changes to residential real estate pricing legislation from May 2017, including a requirement for all homes listed<\/a> for sale in Victoria to have an estimated price, as well as three recent comparable sales for buyers to review and the suburb\u2019s median house price<\/a>.<\/p>\n

The legislation also disallows the use of price ranges with more than a 10% margin between the two figures, and those with no upper limit, such as \u201coffers above\u201d.<\/p>\n

Buying a home is one of the biggest decisions we make in our lives and underquoting muddies the waters and creates distrust between agents and buyers.<\/p>\n

The laws regulating underquoting will help ensure house hunters don\u2019t waste time and money on properties they can\u2019t afford, but it still pays to do your homework.<\/p>\n

\"couple\"<\/p>\n

Do your research and talk to a property expert who isn\u2019t connected to the sale for an unbiased estimate. Picture: Getty<\/p>\n<\/div>\n

How to protect yourself from underquoting<\/strong><\/h2>\n