Baird's underquoting blitz just political grandstanding: Tony Brasier

Property ObserverMarch 25, 20150 min read

GUEST OBSERVATION

The NSW Baird Government’s recent ‘blitz’ on real estate agents , and specifically underquoting, is political grandstanding of the highest order.

By their own admission there were only 82 complaints to NSW Fair trading last year on under quoting – coming from over 200,000 property transactions.

All this in a rising market where it is extremely difficult to very accurately price property based on historical comparable sales.

The current Fair Trading Minister and Premier Baird should be consulting with the industry to arrive at the best long term solutions rather than their current actions obviously designed to win a few more votes. If they are serious about taking appropriate action to avoid any possibility of underquoting there are three steps they should take;

  • Eliminate the growing trend of ‘offers from’. This does no favours for the real estate industry, frustrates consumers and gives the impression the agent hasn’t a clue on assessing the value of a property. Traditionally, there are three main methods of sale – private treaty with a firm asking price; public auction and tender or expressions of interest , both methods, with a firm deadline and a concealed price. The government should insist on one of these 3 methods being employed by agents with no mention of price in an auction or tender process.

  • The NSW government and the Real Estate Institute should be heavily promoting buyers agents in every transaction. This would mean all purchasers had professional representation in the transaction thereby eliminating disputes surrounding price levels, gazumping and the general belief that ,an agent being paid by the vendor, is also acting for the purchaser. This initiative would almost entirely eliminate disputes and ensure a purchaser had advice on market research, price levels, buying strategies and professional negotiating.

  • Increase the education requirements for agent licensing. It is now well documented that the current education requirements are at their lowest levels in NSW history . The entry requirements must be increased and preferably aligned to the best education levels of other States. In addition, the Continuing Professional Development rules should be modified to being less prescriptive and broaden the annual learning requirements.

The government’s current actions where they recently ‘raided’ numerous agents in the Sutherland Shire and announced a blitz on under quoting has to be seen very cynically so close to an election. It is akin to taking a chainsaw to a small bonsai plant.

Tony Brasier is managing director of PRDnationwide.

Property Observer

Tags:
Underquoting
New South Wales
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