A property is advertised as 'Offers Over $800,000' but sells at auction for $950,000. The reserve price was set at $900,000. What is the most likely issue with this marketing approach?
Correct Answer
D) The advertised price was likely misleading, sitting well below the vendor's reserve.
Advertising 'Offers Over $800,000' when the vendor would not sell below $900,000 understates the vendor's expectations. NSW and Victoria have specific underquoting laws against advertising below the agent's estimate or the seller's asking price, and everywhere the Australian Consumer Law's ban on misleading conduct applies. The $950,000 sale simply confirms how far the advertising was from reality.
Why This Is the Correct Answer
An advertised price $100,000 below the reserve tells buyers the vendor will consider offers the vendor has already ruled out. That is likely misleading and, in NSW and Victoria, underquoting.
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A property is advertised as having 'stunning harbour views' but the view is only partially visible from one bedroom window and significantly obstructed by neighbouring buildings. The agent has never personally inspected the property but relied on the vendor's description. What are the potential legal implications?
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A property is advertised with a price guide of '$800,000 - $850,000' but sells at auction for $950,000. The agent had three recent comparable sales ranging from $920,000 to $960,000. What issue has likely occurred?