Underquoting, Victoria: Buyer’s agent David Morrell launches petition to stop agent ‘scams’

Property pricing “scams” remain rife despite state laws banning the dodgy tactic, according to a high-profile Melbourne property player who is pushing to make underquoting an election issue.

\No. 4 Stockdale Ave, Bentleigh East, sold $50,000 over reserve for $1.75m in April.

A high-profile real estate industry player is pushing to make underquoting an election issue when Victorians next go to the polls.

Toorak buyer’s agent to the stars David Morrell is spearheading the push for beefed up real estate protections, arguing the government “isn’t doing their job”, and will tout for signatures this weekend on a petition for change at auctions he believes have been underquoted.

RELATED: Underquoting concerns amid hot Melbourne market

What you need to know about underquoting

Underquoting laws questioned as Mitcham market soars

The three-bedroom home at 15 Noora Ave, Bentleigh East, was sold by Buxton Bentleigh for $1.349m — just within the quoted $1.3m-$1.35m range.

It comes as a Bentleigh real estate agency revealed the results of an almost two-year experiment in which it tightened price guides to a 2.5 per cent range and banned staff from including misleading comparable sales in statements of information to end the “bulls**t”.

Consumer Affairs Victoria permits price guides with an up to 10 per cent range for residential listings.

Despite moves by the state government to stamp out underquoting, Mr Morrell said the practice remained rife.

More than 1040 underquoting complaints were made to CAV last financial year, with 51 fines worth over $300,000 issued in the past three years.

The regulator has accepted enforceable undertakings from a dozen agencies it hauled to court since 2015, with fines and court costs totalling $3.15m.

No. 83 Orange St, Bentleigh East, was advertised with a $1.47m-$1.49m range and sold for $1.525m.

After watching a home advertised for $2.9m-$3.2m sell for $4.6m recently, Mr Morrell said buyers were still “being conned”.

He estimated 80 per cent of buyers were still encountering underquoting and has launched the website cure.net.au, for ‘clean up real estate’, which he hopes will win tens of thousands of signatures demanding the government put a stop to the “scams”.

“The problem is, the government aren’t doing anything about it,” Mr Morrell said.

“There are rules there, but the government aren’t doing anything. CAV aren’t doing their job and the minister isn’t doing their job.

The family home at 19 Park View Drive, Carnegie, sold for $2.065m, which was the same price as the vendor’s reserve.

“When the politicians see votes in acting, they’ll act.”

Buxton Bentleigh director Craig Williamson said frustrated buyers had had “a gutful” of the shonky tactic.

Since setting a higher standard for sales in September 2019 the agency has sold more than 1100 homes, the vast majority of them within their range.

He warned many properties sold massively over reserve often had a reserve “set dangerously low”.

“The buyers aren’t idiots. They know what it’s worth. So why don’t you just tell them?” Mr Williamson said.

“It’s about stopping taking the piss. The consumers have had a gutful of the bulls**t and this is proof it can be done fairly and accurately.”

While 12 Arnott St, Ormond, sold near the bottom of its advertised $1.8m-$1.85m range for $1.81m.

Real Estate Institute of Victoria president Leah Calnan said underquoting laws were implemented to ensure the vendor’s price expectations were clear.

Agents who deliberately sought to con people should face the full force of the law, but she said buyers also needed to do their own research to understand property values.

Minister for Consumer Affairs Melissa Horne said Covid-19 had created “unusual” market conditions.

But she urged anyone who suspected underquoting to report the matter to CAV.

“This kind of behaviour is dishonest, misleading and against the law, and it won’t be tolerated,” Ms Horne said.

Sign up to the Herald Sun Weekly Real Estate Update. Click here to get the latest Victorian property market news delivered direct to your inbox.

MORE: What Victoria’s sixth lockdown means for auctions, real estate industry

AFL property moves: Former Hawthorn boss Bruce Stevenson sells up

Toorak price record: $40m Lansell Rd mansion owners revealed as rich Healey family

– with Rebecca DiNuzzo

Originally published as Underquoting, Victoria: Buyer’s agent David Morrell launches petition to stop agent ‘scams’