NSW Department of Fair Trading minister Matthew Mason-Cox has put dodgy estate agents firmly in his legal cross hairs again, threatening to send more to jail should the NSW coalition win the state election in March next year.
Mr Mason-Cox confirmed that should the coalition win he expects the department to be re-armed with enough firepower to hit rogue business operators, such as underquoting estate agents, with the full weight of the law.
In an interview with News Limited press, Mr Mason-Cox said he won’t put up with underbidding, issuing a challenge to unscrupulous real estate agents.
“We are not going to cop this,” Mr Mason-Cox said, adding he has had first-hand experience of underquoting – something he calls an "insidious practice".
“I’d love to nail somebody … to send a strong message.”
Mr Mason-Cox had been quoted a price on a Sydney unit previously, only for him to discover it sold for 25 per cent more a few days later.
Auctioneers and estate agents welcome the interest the Department of Fair Trading is having in alleviating problems surrounding the real estate industry.
Auctioneer from myauctioneer.com.au, Will Hampson, said he spoke with Fair Trading commissioner Rod Stowe last year regarding the fact underquoting problems could be reined in by disclosing facts to buyers and vendors. Facts, according to Mr Hampson, such as the prices of recent and similar property sale in the local area, that would provide a concrete price comparison guide.
“We try and encourage agents, with permission from the vendor, to talk to buyers about their motivation for moving and their destination, and offering buyers recent sales figures so we are having conversations based on fact,” Mr Hampson said.
“We spoke with Rod Stowe last year and he was very much of the same opinion about using recent sales figures, and a good example of this is if, hypothetically, a three-bedroom home sold recently for $900,000 and the owner of a four-bedroom with a double garage wanted to sell for a million dollars, then recent sales may be a better price guide as an estimate.
“I think if agents are underquoting, putting through low price guides or even talking price then they are potentially leaving themselves open, particularly in strong pockets in the market. If you talk about facts and recent sales you will never be scrutinised.”
Director of Ray White Real Estate in Epping Dennis Nutt said underquoting is not something any good agent would do in the current market. Mr Nutt said demand from overseas investors, particularly Asia, is one reason it is very difficult to pick what a property will sell for.
Mr Nutt said in the current market you really don’t know what price a property is going to end up selling for.
“I had a property last Saturday under the hammer that we quoted between $1 million and $1.1 million and the first weekend we sold at $1,572,500 with 38 registered bids,” Mr Nutt said.
“The campaign was bought forward one week, we had over 200 people at auction and we had even increased the agency agreement range to protect the owner.
“The property was actually selling as a knock-down.”