A group of prominent real estate agents has launched a petition to rally against the practice of underquoting.
The real estate agents and buyer’s representatives say that moves to crack down on the practice have failed and they are launching a petition to force agents to publish reserve prices at the start of sales campaigns.
The group says underquoting leaves prospective buyers shortchanged each week in Melbourne, while baiting customers with apparent attractive prices.
Prospective buyers, thinking they can afford a property, can spend money on lawyers and building inspections while all along never in the running in reality because the real sale price is out of their reach.
The petition said that price representations by estate agents are frequently below a selling price the agent knows the property will sell for or what the vendor will accept.
The practice involves agents disguising the true sale price with terms such as ‘no price displayed’ or ‘price on application’, mainly in high-volume-auction suburbs.
Properties are sometimes being sold for between $100,000 and $500,000 over agents’ highest estimates.
Last year Consumer Affairs received 75 complaints about underquoting, out of 745 total complaints.
Currently there are no laws that require the estimated selling price to be the same as the reserve price.