Experts have warned the Victorian government that it needs to beef-up its “fundamentally flawed” underquoting legislation.
Without doing so, they fear the Allan government’s decision earlier this week to make the Consumer Affairs Victoria’s underquoting task force permanent — at a cost of up to $2.2m per year – will make little to no difference to the property market.
The CAV task force was initially established as a two-year temporary measure, and has received more than 2800 reports, from both members of the public and real estate agents, since it began.
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However, industry figures ranging from agents to buyer’s advocates have signalled that anti-underquoting laws introduced in 2017 remain too weak to address the issue, despite a $39,500 maximum fine for guilty parties.
Last year, the state government’s Housing Statement announced it would impose tougher penalties for breaking the law, including taking commissions away from underquoting agents, echoing a 2016 commitment to do the same thing.
But these measures are yet to be introduced, with the state government unable to comment on an expected timeline when contacted by the Herald Sun.
So far, the task force has monitored more than 1900 sales campaigns, attended more than 200 auctions and issued more than 320 warnings and fines totalling more than $1.6m.
It has launched criminal proceedings against three Melbourne real estate agencies.

Property Investment Professionals of Australia board member and buyers’ advocate Cate Bakos welcomed the decision to make the task force permanent, but also noted there were problems with the “really clunky” legislation.
Ms Bakos said there were no rules to stop owners from changing their reserve price right before an auction, often with no forewarning for agents.
She said the legislation should be amended to stop reserves being changed a minimum of three business days before an auction.
Ms Bakos said heavier fines were also needed for underquoting agents.
“I don’t think the fines are all that punitive to be honest, some agencies would chalk it up to the cost of doing business,” she said.


Apollo Auctions Victoria director and auctioneer Andy Reid said he would like to see more consultation with the industry on the legislation.
He suggested making it mandatory for all bidders to register for an auction, similar to NSW’s system.
Mr Reid said the taskforce needed to attend far more auctions than the 200 it has checked out.
“In two years, is that really anything to brag about, when the number of auctions is 1000 on some weeks in Victoria?” Mr Reid said.
Property Mavens chief executive and senior buyers’ agent Miriam Sandkuhler described the CAV task force as “incredibly slack when it comes to the number of agents operating without a licence”.
In Victoria, real estate agencies must have at least one physical office within the state where someone who holds a current, individual estate agent’s licence works.

Property Mavens director Miriam Sandkuhler wants the CAV to crack down on licence lending. Picture: Beth Jennings.
However, Ms Sandkuhler said there were many agents engaged in licence lending, an offence involving a licenced Victorian real estate agent allowing, or helping, a non-licence holder – often from interstate – to use their permit to act as an agent.
“We have a prolific problem with licence lending,” Ms Sandkuhler said.
Ms Sandkuhler said she, and others, had reported licence lending “time and time again and Consumer Affairs does nothing”.
She said this disadvantaged buyers who unknowingly engaged so-called agents engaged in licence lending.
“They are at risk of dealing with someone who is inept, incompetent and not adequately trained, putting their investments at risk,” she said.

The underquoting task force has attended more than 200 auctions across Melbourne. Picture: NCA NewsWire/Max Mason-Hubers.
A CAV spokesperson said that last Saturday, the task force attended auctions in Essendon, Essendon West, Strathmore, Avondale Heights, Airport West, Ascot Vale, Moonee Ponds and Keilor East.
“Our underquoting task force uses market analysis and intelligence to monitor for potential underquoting, making our property market fairer for buyers and industry professionals who are doing the right thing,” the spokesperson said.
“We inspect hundreds of real estate agencies to obtain sales files for review to crack down on underquoting.”

CAV UNDERQUOTING TASK FORCE WARNINGS AND FINES, ISSUED 2022-2024:
-An Estimated Selling Price (ESP) being unreasonable and not based on comparable sales
-Non-compliant comparable properties listed on a statement of information (SOI)
-Failure to include an SOI with an online advertisement
-An ESP being lower than an offer that had been rejected by the vendor
-A property’s advertised price being modified by words or a symbol
-An advertised price being lower than the ESP
-The auction authority, or sales authority, not getting updated following an amendment to the ESP
-An ESP not being provided by agent, before obtaining a vendors’ signature
Source: Consumer Affairs Victoria