The Minns Labor Government has started consulting on a major update to NSW’s underquoting laws. The goal is to lift standards in the real estate industry, make property prices clearer, and give buyers more confidence when they search for homes.
Underquoting happens when a property is advertised with a price guide that is far lower than what the seller is likely to accept. This leads buyers to spend time and money on homes they never had a real chance of securing. The new proposal aims to reduce this problem and protect buyers.
Key Changes Being Considered
1. Higher penalties for underquoting
Fines would rise from $22,000 to $110,000, or three times the agent’s commission, whichever amount is higher.
2. Mandatory price guides
Every advertisement would need to show a clear price or price range, so buyers can check if the property fits their budget.
3. A required Statement of Information (SOI)
Agents would need to publish an SOI showing how they arrived at the estimated selling price. This would include recent comparable sales and the suburb’s median price.
4. Clearer rules for price estimates
Agents must calculate and update their price estimates based on new guidelines from NSW Fair Trading.
5. Stricter advertising requirements
Price guides must be accurate and updated quickly. Agents would not be allowed to advertise a price below a rejected offer or bid.
6. Stronger record-keeping
Agents would need to keep detailed evidence of market feedback, offers made, offers refused, and any changes in market conditions. This information will help Fair Trading monitor compliance.
7. More disciplinary powers for Fair Trading
Fair Trading could:
- publish breaches,
- require independent valuers to confirm an estimated selling price (with no cost to the seller), or
- suspend an agent’s ability to sell property.
8. A new offence for skipping professional training
Failing to meet ongoing training requirements would become a standalone offence.
Why These Reforms Are Being Proposed
In 2024 alone, NSW Fair Trading issued more than 100 penalty notices for underquoting. The government says stronger tools are needed to improve trust and deal with repeated issues in the market.
These reforms are based on Victorian laws introduced in 2016. Those changes led to millions in fines and are now widely supported across the industry.
The government plans to introduce the new legislation to Parliament next year.
What NSW Leaders Are Saying
Minister for Better Regulation and Fair Trading, Anoulack Chanthivong:
He says both buyers and industry agree that tougher underquoting laws are needed to restore confidence. The aim is to create rules that protect consumers without making the process unworkable for agents.
NSW Strata and Property Services Commissioner, Angus Abadee:
He says the reforms will help ensure buyers are not misled by inaccurate price guides and will make it easier to hold agents accountable. Clearer documents and higher penalties will reduce wasted time and money, especially during a period of high living costs.