In a story which could resonate with some UK agents and auctioneers, an estate agent in Australia is being prosecuted for alleged ‘under quoting’.
This is how the Australians term a practice by which properties are advertised for sale at a lower guide price than the agent’s own valuation.
‘Under quoting’, used as bait to drum up interest and tempt purchasers to participate in open days and auctions, is said to be common in Australia where sales by bidding are routine.
The practice means that would-be buyers can waste money on fees when they could never actually afford to buy the property.
Others do buy but end up paying more than they had been led to believe would be the case.
However, ‘under quoting’ is said to be notoriously difficult to prove and this would be the first prosecution in more than a decade.
The agency, Bresic Whitney in Sydney, is accused of ‘under quoting’ on two properties.
One was marketed with a price guide of $1.5m, when the agency agreement with the vendor had a low end value of $1.6m. The property sold for $1.76m.
‘Under quoting’ is specifically illegal in Australia under the Property, Stock and Business Agents Act 2002, with penalties of up to $22,000 and, importantly, cancellation of the estate agent’s licence.
Trading Standards (or their Australian equivalent) has apparently been attending auction sales and open days incognito, and examining sales agreements.
With many auction houses in the UK never failing to crow in their post-sale publicity about how certain properties went for prices miles above their guides, one can’t help wondering whether there might be a test here – perhaps under Consumer Protection Regulations?