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REISA Lauches Underquoting Advisory Panel

25 Nov 14

The Real Estate Institute of South Australia (REISA) will establish an Underquoting Advisory Panel to assist the Chief Executive Officer and the Professional Standards Committee in determining whether sufficient information and evidence exists to progress a formal complaint of underquoting through the official REISA grievance channels.

REISA takes its role of ensuring the highest professional standards of practice are achieved by its members.  In addition to the legislation, REISA requires its members – through its Code of Conduct – to provide an honest, researched and realistic appraisal of the market value of a property.

From time to time REISA is advised of possible instances of underquoting – being deliberately quoting a price below that which would ordinarily be acceptable to the Vendor. The Agent’s genuine estimate, based on experience and comparable sales (if any) is critical to the vendor as well as ultimately to any price representation on a property for sale.  In this process, it is critical that agents are as diligent, professional and transparent as possible.

The practice of underquoting can be a very difficult complaint to manage and determine due to the various opinions and views on pricing representations with regard to selling real estate.  The views of the Underquoting Advisory Panel will be invaluable in guiding the initial complaint and its subsequent referral and determination by the Professional Standards Committee.

REISA notes the approach currently being mooted by the Victorian political parties to attempt to address the problem of underquoting.

The new legislation in South Australia which commenced on 1 January this year is actually tougher than the proposed new Victorian laws on underquoting.  In this State, the agent must give evidence of their genuine estimate to the vendor and the reserve is now linked to the vendor’s acceptable price which gives a prospective purchaser the reserve price of a property if it is advertised with a price.

However, a problem will always exist with determining if an agent’s genuine estimate is in fact, genuine.  This Panel will help in eliminating that problem