What constitutes underquoting in property marketing?
Correct Answer
B) Quoting a price the agent does not reasonably believe the property will sell for.
Underquoting occurs when an agent quotes a price or price range that they do not reasonably believe the property will sell for, regardless of the specific percentage difference. This practice misleads buyers about the true market value.
Why This Is the Correct Answer
Underquoting is quoting or advertising a price the agent does not reasonably believe the property will sell for. The test is the agent's genuine, evidence-based estimate, not a percentage.
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- → An agent in NSW quotes a property at $800,000-$850,000 but sets the reserve at $900,000. Three weeks later, the agent receives feedback that most buyers are interested at $820,000-$840,000. What should the agent do to comply with underquoting legislation?
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Previous Question
A Victorian property is advertised at $800,000 to $850,000. Before the auction, the vendor tells the agent the reserve will be $900,000. Under the underquoting laws, what must the agent do?
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