Underquoting reforms set for early 2016.

Victor Dominello, the Minister for Better Regulation, has said that reforms to rules surrounding underquoting would provide “clarity” for agents, vendors and buyers.

NSW Fair Trading defines under-quoting as making “a statement in the course of advertising a residential property for sale that is less than the agent’s true estimated selling price as recorded on the agency agreement”.  Currently penalties for engaging in underquoting are fines of up to $22,000.

Estate Agents Co-operative (EAC) has been working with and provided advice to the Real Estate and Property division of NSW Fair Trading on the new reforms.

The new reforms, which have been introduced to parliament and are expected to commence in early 2016, will see stricter rules for agents in regards to the estimated selling price in their agency agreements.  Agents who do not adhere to this estimated price in advertising will face losing fees and commissions.  Further to this, phrases such as “offers over” or “offers above” or any similar phrase will also be prohibited in advertising.

The proposed underquoting reforms will ensure any estimated price communicated to vendors and prospective buyers represents what an agent actually expects a property to sell for.

Under the proposed reforms, an agent must:

  • Include their true estimate of a property’s likely selling price in the agency agreement (also called the sales agreement).
  • Record the evidence that informed this estimate and provide it to the vendor in writing.
  • Ensure a price range is no greater than 10% of the bottom figure (eg. $500,000-$550,000).
  • Record all price estimates (quotes) provided while a property is marketed.
  • Ensure their price estimate remains realistic by updating it and advising the vendor in a timely manner if they are aware – or should reasonably be aware – of evidence or circumstances that changes it. The agent must advise the vendor of their revised selling price estimate and the evidence on which it is based in writing (eg. email) and amend the agency agreement. They must also update, as soon as feasible or practical, any marketing of the property that reflected the old estimate with the new selling price estimate.

Agents will not be able to:

  • Provide any price estimate less than what they have assessed a property is worth (as recorded in their agency agreement with the vendor). This applies whether the agent is advertising the property or in any communication with prospective buyers about the property’s likely selling price.
  • Advertise vague price information, including any statements such as “offers above” or “offers over” an amount, or “plus” a particular price (eg. $500,000+), which could misrepresent or obscure a property’s estimated value. Also, an agent must never indicate a selling price estimate that does not match the agent’s true estimate.
  • The reforms will introduce stronger penalties to deter underquoting. This includes fining agents up to $22,000 if they breach the new requirements. Agents could also have to forfeit their commission and fees if found guilty of underquoting. These commissions and fee payments will go towards the Property Services Compensation Fund, which supports consumers who have experienced financial loss as a result of property agent misconduct.

Mr Dominello’s office has also made clear that there have been 263 complaints about underquoting in the past two financial years.  With 63 of these complaints being made in March 2015.

In light of a volatile market agents should be reviewing their estimates and any marketing to reflect any change to the price estimate as a result of market or vendor feedback. We welcome the reforms announced by the Minster and feel they will make clear to agents as well as to consumers, the responsibilities when making these estimates.

The new legislation is currently in Parliament and would appear to be held up by opposition to some of the changes. Personally I believe the proposed changes can only assist the industry in being more professional in dealings with consumers both vendors and potential purchasers.

THE BEST OF THE BEST IN NSW AUCTIONEERING

Estate Agents Co-operative and Real Estate Institute of Australia have once again hosted the NSW heats of the Australasian Auctioneering Championships. 10 of the top auctioneers in the state fought it out for a place in the National Championships.

The competitors in this year’s heats included:

Andrew Cooley – Cooley Auctions
Briannan Crawford – Cooley Auctions
Clarence White – McGrath Estate Agents
Damien Cooley – Cooley Auctions
Edward Riley – McGrath Estate Agents
Gavin Croft – Bresic Whitney Estate Agents
Joshua Larsen – McGrath Estate Agents
Leon Axford – Axford Auctions
Lucas Cannan – Think Real Estate
Will Hampson – My Auctioneer

The winner in this year’s final was EDWARD RILEY of McGrath Estate Agents (pictured) with the runner up DAMIEN COOLEY of Cooley Auctions.

Edward and Damien will now go onto the National Championships in the hope of securing a place at the Australasian Championship in Melbourne 1 – 3 September 2015.

“Both Edward and Damien I’m sure will do NSW proud at the National Championships,” said Dale Whittaker, Chairman of EAC. “The absolute best in NSW auctioneering came to compete today, so Edward and Damien should be very proud and I look forward to watching them compete in Melbourne.”

“I would like to thank all the competitors for their entry into this year’s competition, I wish you all the best and I think that it is great to see the number of high quality entrants in this year’s heats,” said Neville Sanders, President of REIA.

EAC and REIA would also like to thank the major sponsor of the NSW heats, AON. AON is a sponsor of the REIA and was recently announced as the Insurance Partner for Estate Agents Co-operative.

New South Wales top auctioneers are now set to find out who will be the top auctioneer in 2015

Entry to the New South Wales Heats of the Australasian Real Estate Institutes’ Auctioneering Championships has now closed.

This year sees Gavin Croft who took out the NSW competition for last two years  as well as the runner-up from the 2014 Clarence White back to try to take out the title for the chance to join the other winners from around Australia & New Zealand at the finals which are being held in Melbourne on the 1-3 September 2015.

Gavin Croft from Bresic Whitney Estate Agents  said “Both the NSW heats and the Australasian Championships are always fiercely contested. By the quality of this year’s entrants, it appears 2015 will be no different.”

The entrants in this year’s heats include:

Alex Pattaro – LJ Hooker

Andrew Cooley – Cooley Auctions

Ben Horwood – LJ Hooker

Briannan Crawford – Cooley Auctions

Clarence White – McGrath Estate Agents

Damien Cooley – Cooley Auctions

Edward Riley – McGrath Estate Agents

Gavin Croft – Bresic Whitney Estate Agents

Joshua Larsen – McGrath Estate Agents

Leon Axford – Axford Auctions

Lucas Cannan-  Think Real Estate

Will Hampson – My Auctioneer  Sydney

The CEO of REIA, Amanda Lynch, said: “NSW has a strong and proud history of auctioneering reflected in the record weekend auction clearance rates. One of the finalists could very well be the auctioneer who snatches the Australasian trophy from New Zealand this September as Scott Kennedy-Green did for NSW in 2006.”

Personally I would like to thank all the competitors for their entry into this years competition, I wish you all best and I think that it is great to see the number of high quality entrants in this year’s heats.  It would be good to see a New South Wales Auctioneer make the finals or even better take out the title at the Championships in Melbourne this later year.

We would also like to announce a new major sponsor for the New South Wales heats this year AON. AON is a sponsor of the REIA and was recently announced as the Insurance Partner for Estate Agents Co-operative.