The underquoting definition – What is Underquoting in real estate industry?
Well, although we often hear or read underquoting, there is no clear definition of underquoting. According to Consumer Affairs Victoria, under-quoting happens if the quoted price is lower than the written estimate of the value of the property provided by the selling agent on the sales documentation before the advertising campaign began.
Underquoting is not a new technique that real estate agents use to get a lot of people interested in a property by specifying a significantly lower price-range knowing that the property will sell for much more.
Is Underquoting legal?
No, it is NOT!
A Melbourne real estate agent has had his licence suspended for underquoting, following a two-year battle with the state’s watchdog and courts.
The Victorian Civil and Administrative Tribunal withdrew real estate agent Dean Anthony Johnson’s licence for two months, reprimanded him, and ordered him to provide proof for the next two years that he is not marketing properties to would-be buyers at prices below the minimal price set out by the sellers. Mr Johnson is a director at Footscray-based Wayne Sweeney and Associates.
Mr Johnson had already paid $5000 in fines to the Victorian Property Fund in March 2012, after Consumer Affairs Victoria brought the case against him. VCAT found he had underquoted on four properties in the Melbourne suburbs of Maidstone and Yarraville. Another agent Darren James Dean was also charged by VCAT in 2010, as well.
Mr Johnson successfully appealed the 2010 the judgment to the Supreme Court, which then sent the matter back to VCAT for its latest decision this month.
“Buying a home is usually the biggest financial outlay in a person’s lifetime and laws are in place to protect consumers from misleading advertising and underquoting,” said Consumer Affairs Victoria director Dr Claire Noone.
“Licensed estate agents should be aware of their obligations under the Act and the Australian Consumer Law in relation to advertising properties,” she said.
Mr Johnson was not immediately available for comment.
Property buyers in Melbourne have long contended that agents underquote prices on properties to lure prospective buyers, although typically there is little hard evidence of the practice.
I think now property buyers can borrow the experience from this case and forward their concerns to government bodies in order to fight underquoting.