The NSW Department of Fair Trading is reported to be investigating three Sydney agents for underquoting, according to Fairfax Media.
“It is alleged the agents attempted to drum up competition for properties by telling buyers the houses were worth far less than market prices,” Fairfax said.
“If proven guilty, the agents will be the first in a decade to be convicted of underquoting, which is banned under the Property, Stock and Business Agents Act 2002 and carries penalties of up to $22,000 and licence cancellation.”
The Department of Fair Trading would not confirm how many agents it was investigating when contacted by Real Estate Business, nor would it reveal their identities.
“Customer complaints and anecdotal evidence suggests that underquoting is an issue within the real estate industry and NSW Fair Trading is currently investigating claims of misconduct or underquoting.
“A number of specific agents are under investigation as a consequence of our marketplace surveillance activities.
“So [as not to] compromise the ongoing investigations it is not appropriate to provide any further details at this stage,” a spokesperson said.
The spokesperson also said that the department is continuing to work with agents and consumers to raise awareness about underquoting and similar practices.
“We encourage consumers to come forward and report cases of underquoting to NSW Fair Trading,” the spokesperson said.
According to Fairfax, the three agents are from Sydney’s central business district, eastern suburbs and inner-west.
Underquoting became a political issue in Victoria during the November state election.