In May of this year (2017), the Estate Agents Amendment (Underquoting) Act 2017 (VIC)(‘the Act’) commenced by proclamation. The Act amends the Estate Agents Act 1980 (VIC) (‘the Principal Act’) and introduces a variety of provisions that aim to address complaints of underquoting and other poor practices by estate agents during the sale of property. Most recently in July, two Victorian real estate companies have been penalised under the new provisions. The amendments are a response to a . In the report, Taskforce Vesta monitored 200 properties from first online listing to final sale throughout 2015-2016, and found significant rates of sales over the estimated price.
On 9 July 2017, two Melbourne real estate companies were penalised under the new provisions by Taskforce Vesta and issued with monetary penalties. In addition, they will have to put in place a compliance programme, and will be required to display a public statement of their actions in their office. Consumer Affairs Minister :
Agents are now under an obligation to give the seller of the property an estimated selling price, under section 47A of the Principal Act. The price is to be expressed as a single amount and if it is a range, the difference between the upper and lower limits of the range cannot exceed 10 percent of the amount of the lower limit. The selling price estimate must also be reasonable, under section 47B. Furthermore, in determining the estimated selling price, the agent must take into account three comparable properties that have been sold within the previous six months if it is within the Melbourne metropolitan area, of eighteen months if it is outside of the metropolitan area. If the selling price must be revised, the agent should notify the seller in writing.
Statements of information, a new requirement under section 47AF of the Principal Act, are for the purpose of increasing buyer awareness of not only the prospective price, but other comparable prices. Statements of information are only required for those properties where the sales authority was signed on or after 1 May 2017. A statement of information must include:
The new legislation has introduced a number of provisions relating to misrepresentation and misleading advertising by inserting new section 47C into the Principal Act.
In addition, the agent must also change references to the price within one business day If the seller has rejected a price that is similar to or higher than the advertised price.
Substantial penalties of up to 200 penalty units, which is more than $31,000, will apply for non-compliant real estate agents or companies. Courts can also forfeit commissions or other considertaion received in the course of engagement for serious offences. Taskforce Vesta will soon be looking into anto raise awareness amongst vendors and estate agents.
TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products. Nothing on this website should be construed as legal advice and does not substitute for the advice of competent legal counsel.
Estate Agents Amendment (Underquoting) Act 2017 (VIC), second reading speeches and other materials, as published on TimeBase LawOne.
Estate Agents Act 1980 (VIC), as published on TimeBase LawOne.
‘,’ (ABC News), 9 July 2017.
Kaitlin Offer, ‘,’ (AAP), 9 July 2017.
Consumer Affairs Victoria, ‘,’ 4 November 2016.
Consumer Affairs Victoria, ',' 10 July 2017.
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