The new underquoting laws became effective on 1st January 2016. One of the main aspects of the new rules is that an agent should regularly revise the estimated selling price of a property and formally advise the seller of this revision.
Why would the estimate change?
During the course of the marketing campaign, market changes or feedback from potential buyers may indicate that the estimated selling price is no longer a reasonable estimate of the likely selling price. If this is the case, you must revise the estimated selling price.
How often should the estimate be reviewed?
NSW Fair Trading advise that you should review your estimated selling price on a weekly basis and consider if the estimate is still reasonable.
What should you do if your estimate changes?
If you do revise the estimated selling price, you must give written notice to the seller of the revised estimated selling price (whether that be a single price or price range) and provide them with evidence to support the reasonableness of your revised estimated selling price. You’ll also need to amend the agency agreement to reflect the revised estimated selling price.
How we can help
The new legislation did not contain a prescribed form or prescribed requirements as to what information must be included in a notification of revised estimated selling price, or how an agreement should be amended. With this in mind REINSW has designed a form that sets out a series of steps to assist you.to comply with your new obligations. If you complete the notice correctly and serve it at the correct time, then you will have satisfied your obligations.
This form is called the Notice of Revised Estimated Selling Price. It is available to you, at no cost, in two formats:
- If you are an REI Forms Live user then it is available and can pre-populate most of the required data from the relevant agency agreement that you would have already prepared. If you are not yet an REI Forms Live user then you can find out more and enjoy a free trial by clicking here.
- Alternatively the Notice is available as a PDF which you can download and print. Please download the form by clicking here.
Also, don’t forget that you will need to take all reasonable steps, as soon as practicable after revising the estimated selling price, to change or withdraw any advertisement or marketing material displaying a selling price that is different to the revised estimated selling price.
To download our one page Underquoting Quick Guide please click here.