Underquoting could be a thing of the past in New South Wales with new industry guidelines recently released by the state’s Department of Fair Trading.
The guidelines, developed by the department in conjunction with the Estate Agents Co-operative, Real Estate Institute NSW (REINSW) and other industry stakeholders, are designed to provide agents with a better understanding of what constitutes underquoting and how it can be avoided.
The proposed laws will clarify what constitutes underquoting, expand the existing financial penalties to include commissions and fees and place more stringent record-keeping requirements on real estate agents.
Underquoting occurs when an agent falsely understates the estimated selling price of a property in the course of marketing that property and is an offense under Property, Stock and Business Agents Act 2002.
“For most people buying a property is the biggest purchase they will make in their lifetime and the NSW Government is working in partnership with the industry to ensure the law regarding price advertising and representations is clear to all real estate agents,” Fair Trading minister Victor Dominello said.
“We have also made a commitment to enhance legal protections against underquoting and we will be introducing legislation in the new Parliament.”
Estate Agents Co-operative chief executive officer David Crombie believes the new guidelines will give agents a better understanding of their responsibilities.
“We welcome the guidelines announced by the Minister and feel they will make clear to agents, as well as to consumers, their responsibilities when making these estimates,” he said.
While the new guidelines are designed to end the practice, REINSW CEO Tim McKibbin believes underquoting will only be stopped when prospective estate agents are required to undergo more stringent training before joining the profession.
“It’s little wonder that underquoting and other compliance issues exist within the profession, when government permits and encourages new entrants to enter the profession with as little as one day of training,” Mr McKibbin said.
“The only remedy is improved entry-level education.”
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