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Buried findings: Real estate expert’s frustration at underquoting inaction
By Aisha Dow and Kieran Rooney
A real estate industry stalwart commissioned to deliver advice on Victoria’s underquoting laws has called on the Allan government to release the unpublished recommendations, as the premier promised to consider what more can be done to tackle the “shabby practice”.
Enzo Raimondo, the former head of the Real Estate Institute of Victoria (REIV), was one of two expert panellists appointed by the government to consider if the laws governing the state’s property market, including underquoting, could be improved.
However, the findings of the taxpayer-funded report were buried after its completion in 2022, and the government has repeatedly declined to explain to those who contributed to the widely publicised review why it hasn’t released it.
“I’m surprised it still hasn’t been released … but certainly it should be,” said Raimondo, who spent 16 years as chief executive of the REIV.
“There’s a lot of work involved, and it would be a shame for it just to sit on a shelf and do nothing [but] collect dust.”
The Victorian government is under mounting pressure to act in response to the findings of this masthead’s Bidding Blind investigation, which analysed tens of thousands of property sales and uncovered an extraordinary level of misinformation and deception facing buyers in Melbourne and Sydney.
The investigation found some suburban real estate offices have been selling more than nine in every 10 of their listings above the top estimate given to buyers.
Opposition Leader Brad Battin said he would be happy to sit down with the REIV and real estate agents and “work out what is the best solution to ensure there’s fairness for all people wanting to buy into the market”.
The Victorian Greens said they would this week introduce a bill to parliament requiring the reserve price of a property to be disclosed before auction day, in a bid to stop buyers unwittingly forking out thousands of dollars on inspection reports for homes they can’t realistically afford.
The REIV is calling on the government to start fresh consultation on how to improve fairness in the property sector. The peak real estate lobby group is also now backing mandatory pre-auction disclosure of reserve prices by sellers, in a significant policy pivot announced on Monday.
Premier Jacinta Allan earlier this month.Credit: Eddie Jim
“Reserve price disclosure isn’t just backed by consumer advocates, even the Real Estate Institute of Victoria and leading property industry figures support it,” said Greens public and affordable housing spokeswoman Gabrielle de Vietri. “With the public and industry on board, Labor has no excuse to delay.”
Premier Jacinta Allan said she would seek advice on that proposal and also the merits of a model that would result in those selling their home providing prospective buyers with a free pest and building inspection documents.
“We are open to looking at what we can do to make the property market fairer for everyone,” Allan said.
She described underquoting as a “pretty shabby practice, which is why we’re cracking down on it and made it illegal”.
Enzo Raimondo, pictured in 2014 when he led the REIV.Credit: Fairfax
Raimondo said he couldn’t disclose the recommendations made by him and his property market review co-author, consumer advocate Carolyn Bond, due to a confidentiality agreement. But he confirmed the 2022 report did include recommendations he believed would reduce the prevalence of underquoting.
“We spent months on it. We interviewed consumers, we interviewed industry groups, we interviewed agents, and there’s some, I think, excellent recommendations on the issue of reserve price [disclosure],” he said.
“It’s odd that the review, which is meant to assist, hasn’t been released … I can only speak for myself and not the other panel members, but I was certainly disappointed that it wasn’t released and at least debated openly on what should occur.”
When asked if there was any reason not to make the report public, Allan said the report was a cabinet document, and she was more focused on “acting now, leading the nation in cracking down on illegal underquoting”.
Raimondo said the review received fairly consistent feedback from the public that agents were providing price guides that were off the mark.
He said while agents would use the excuse that they’re not property valuers, they generally worked in the same sector for a long period and should know their market.
The use of three comparable properties to justify price guides was being manipulated by agents and the criteria around this needed to be tightened up, Raimondo said.
“In Victoria, it’s not a bad system. It’s just that it’s not being used correctly,” he said.
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