Under the amended Property Stock and Business Agents Act 2002, agents who are found guilty of underquoting will now be liable to forfeiture of any commission or fees from the sale, on top of the current $22,000 fine.
The changes also prohibit the use of phrases such as “offers over” or “offers above” in the marketing of properties and agents are required to provide evidence of their estimated selling price to the vendor and this estimate must be stated in the agency agreement.
Agents will also have to keep a register of prices quoted on a property, whether these are provided to the vendor or prospective buyers, and must only use the estimated selling price provided in the agency agreement.
Minister for Innovation and Better Regulation Victor Dominello said the reforms were necessary and long overdue.
“The NSW Government committed to overhauling the current laws to crackdown on the practice of real estate underquoting – and we have delivered,” he said.
“There have been no successful prosecutions related to underquoting made under this Act in 13 years, so this reform is long overdue.”
Real Estate Institute of New South Wales president Malcolm Gunning said the reforms were welcomed by the industry.
“The reforms bring clarity and surety to the real estate industry. We support this legislation that will require agents to be much more accountable in the determination of current market value and provides transparency to those seeking to make a purchase,” Gunning said.
“These reforms are a step forward for the real estate industry and are in line with our goal of stamping out poor agency practice,” he said.
