Underquoting reforms in 2016

Hi,

Interesting to see how it works in practice.

Six ways the underquoting reforms affect you

 

So, in reality, will this simply lead to even more properties being advertised without a price ?

 

They should make a law all properties to be advertised with a price

 

Yeah, it's an interesting argument.

As a buyer, it is way easier to do my research etc if a clear price is attached...

As a vendor, why shouldn't I be able to advertise and sell my property in whatever way I choose...

 

Regardless of how accurate the indicated sales price?

 

Because people massively underquote. My sister listed theirs for 640k but knew they'd get well over 7. They ended up with 770k.
Another friend put her inner west unit for auction with a price something like over 350k but really they wouldnt accept less than mid 4's, she told me herself. The agent was telling them to advertise with the very low price. It easily sold at auction for much more.
Now its cooling in Sydney, I tend to think the ban on "offers over" is not necessary and me as a seller I'd want to be able to use it. But being 100k or more off... is ridiculous. I think perhaps to be transparent the price shown should reflect what you as the vendor agree to in the agency agreement.

 

Auction didn't game, but forsale price probably harder to underquote.

 

A $100k range in a sub-$500k market is not acceptable but when talking> $2m that's your stamp duty.

The range shown and the comparables used should be reviewed by OFT post sale as proof of honorable conduct.

 

Agree with this. I should have mentioned relative to total price.
A colleague also was looking to buy a few months ago. Her budget I think started at 650k. She was looking at properties listed at 650k.
No chance. She was always getting outpriced, and these were private treaty sales, and often they were selling for the 750k mark.

Eventually she increased her budget about 100k and ended up buying a few suburbs further out than planned.
That's what happened.... hot market....

Anyway... on a different note... I think that not being able to show a guide price for Brisbane auctions is pretty silly, but there aren't that many auctions there though. Makes it more work all round.

 

It does make it a little difficult trying to sell a product without mentioning price especially when you're trying to convince someone to spend multiples of $100 k

 

Personally i have never really been too worried about underquoting. I dont really believe anything an agent tells me anyway. After i do all my research I pretty much have a good idea the value of the property and what i am willing to pay for it. Whenever i hear a quote from an agent that is ridiculously low i just laugh to myself and think 'good on him for trying with me'. Besides, if i was selling a property, i would want the agent to underquote a bit in order to drag in more people, build up the atmosphere on the day and hopefully get the bidders to bid as emotionally as possible. Just my personal opinion.

 

I thought the one we just exchanged on on Tuesday was clearly going to be a case of underquoting... but the vendor accepted our offer on it. The price all depends on the market!

 

I agree with you. The market largely will dictate what is possible and not possble for an investor to do. But there are those times..whether its due to the circumstances of the vendor and/or an incompetent agent, where a buyer sneaks in and gets a steal, even though the market dictates the vendor could have gotten more.

 

oh yeah... this West Ryde property I picked up was a bargain ... bad agent, they specialise in rentals not sales, it had pretty bad photos on the internet and the vendor had no idea of the market as she lived interstate, the Brisbane one... again I'd say a bad agent (fairly new listing but the agency didn't do an open that weekend cause both agents were on holidays ).
There are good buys out there...

 

Very nice pick up @Gockie! Its unbelievable but it happens.

I have seen now twice in the same building over the last 18 months, out of town agents in a great beach area advertise a 2 bedroom appartment and the marketing material had NO VIEW OR MENTION showing the harbour bridge, yet from the main bedroom there was an almost perfect view!!! Un-freakin-believable.

 

All properties should have to be advertised with a floor plan with the measurements and no photo touch ups

 

Dream on

 

Yea real estate agents would be crying if that happened lol

 

...and a copy of any transcript of all discussions between agent and vendor too.

 

Now this was interesting....

The place we are buying, the agent had left the paper list of attendees at the front door on a bench. (I even heard her say to one group to even write their own details on the page!!)

Anyway, I noticed towards the end of the
open home I saw she (or someone from the agency) had written notes all over the open house attendance listing. We saw s/he wrote on it... it said it was our third visit, pending finance, but I saw s/he wrote on the next group of people, 3rd visit, offer rejected (my partner reckons he recognised them from a previous open). Unfortunately for us there was no mention of what that offer was so I don't know if it was 100k, 50k or something else less. And then the page went on to say 3 outright nos (ie. Not buyers) for the next few attendees.
Really shows where you stand!

Gave me confidence.... but then again, if I was in the other interested party and saw that we were seeking finance... they could have thought about increasing their offer. Which would have been very bad for us.

Anyway, we really got moving after that and the vendor accepted our offer... exchanged on the Tuesday 3 days before Christmas...I suppose the other lower offer could have conditioned the vendors to think the market is really cold... I know if I was in their shoes I'd be thinking it's better to accept a decent offer pre Christmas rather than a possibly better (but no guarantees) offer post Christmas... a bird in the hand is better than 2 in the bush... anyway long story short... i'm stoked.

Leaving that list though in full view of everybody.... not sure if it was smart or dumb... I'll say dumb... there was even bright highlighting on the page everywhere noting the comments... I couldn't help but see it...