Real estate agents in New South Wales could face fines of up to $110,000 (£57,000) for underquoting properties under proposed laws aimed at cracking down on misleading conduct and increasing transparency for buyers.
The Minns government has begun consulting with the property sector as it prepares to draft legislation, expected to be introduced to parliament next year. The proposed laws would also mandate a price or price guide on all advertising to prevent buyers from wasting time on properties outside their budget.
Underquoting involves agents advertising a property for less than the estimated selling price or the owner's asking price to attract buyers and stimulate competition. While already illegal under federal consumer law, the NSW government believes stronger measures are needed.
NSW Minister for Better Regulation and Fair Trading, Anoulack Chanthivong, said: 'Our message is that we hear you. We've developed a package of reforms and are now consulting with the sector to ensure we get the balance right between consumer protection and practical implementation for industry.'
The proposed fines would increase from $22,000 to $110,000, or three times the agent's commission, whichever is greater. Agents would also be required to publish a 'statement of information' explaining how the selling price was calculated, including comparable sales and median prices.
The NSW government plans to model the legislation on laws passed in Victoria in 2016, which are now widely accepted by the industry. The reforms follow high-profile cases, including the suspension of Sydney agent Joshua Tesolin for alleged underquoting on over 100 properties.
