Attributable to REINSW CEO, Tim McKibbin:
"The data clearly shows that allegations of under quoting increase in a hot market and cease to be a problem in a stable market. Accurately predicting the estimated selling price of a property in today’s market is extremely difficult.
Despite the above Agents have a statutory obligation to ensure that their estimate selling price of the property is reasonable and current, again this can be very difficult when the market is hot and unpredictable. Unfortunately, like every industry, there is a small proportion of practitioners who do the wrong. However, an increase in reports of this activity is driven by the hot market, not by an increase in illegal activity.
There are many factors agents must consider when determining their estimate of the likely sale price. For example, recent sale prices of similar properties in the immediate area and the unique attributes of the subject property. In the last six months, we have seen units and townhouses achieve sale prices far greater than properties within the same strata complex that were sold only weeks earlier. It makes predicting the sale price of a property in this market very difficult.
Agents in New South Wales are not obligated to provide prospective purchasers with their estimated selling price. However, it is preferable that Agents assists purchasers with their enquiries with respect to price to enable purchasers to determine if their financial resources enable them to participate in the competition for the property. In at least one other Australian State Agents are prohibited from expressing an opinion of the likely sale price for an auction sale. The REINSW hopes this is not replicated in NSW, clearly such a system does not assist purchasers.
In summary, it should be recognised that there is a significant difference between under quoting and a hot and unpredictable market."