What is Underquoting in Real Estate and Why do Real Estate Agent’s Do It?
Underquoting in Real Estate is illegal, and agents can face disciplinary action for doing so. The problem is most property buyers are not aware it is illegal and do not report it to Fair Trading NSW. An example of underquoting is when a real estate agent quotes a price or price range to a buyer knowing full well that the owner will not accept the price they are quoting. You may see a price guide of $1,300,000 advertised by the agent, sadly you need to add 10-15% on top of this quoted price as that will be the likely selling price.
“Underquoting is illegal conduct that real estate agents engage in to mislead property buyers about the likely selling price of a property knowing full well the owner will not sell at that price. It is illegal to underquote in most states”.
Why Do Agents Underquote?
Personally, I don’t understand why they do. Apart from being dishonest and illegal, it is not doing any favours by the property seller. If anything, it will attract the wrong buyers, property buyers that cannot afford the property. It is no wonder our industry has such a poor reputation amongst consumers.
“When you hear a property sold for $100,000 above this generally means that it sold for the market price. 10-20% more than what the agent has quoted.
Here are some examples of underquoting?
Some of Our Recent Experiences are:
Location price quoted sold price
Newtown $1.3 M $1.8M
Kingsford $1.6 M $1.8M
Petersham $900,000 $1,070,000
Alexandria $700,000 $950,000
Alexandria $700,000 $1,000,000
What Can I do about Underquoting
If you are in NSW Fair Trading NSW is the regulator for real estate agents in NSW? You can report it by calling 13 32 20 or Click here and complete the form. Submit as much detail as you can. Any email evidence or when and where it took place.
“If you have been a victim of underquoting click about and lodge a complaint with the regulator who will carry out an investigation”
