People trying to sell their homes will be disadvantaged under new laws requiring vendors to publish their reserve price a week before an auction, a leading buyers’ advocate says. The state government introduced legislation to parliament on Wednesday to tackle dodgy real estate agents from underquoting properties by prohibiting agents from taking a property to auction unless the vendor’s exact reserve is published a full seven days prior. The law would be in place from October 1.

The legislation also mandates sold prices must be made public – so buyers can see what homes in their area are really worth. Melbourne buyers’ advocate and Property Investment Professionals of Australia chair Cake Bakos said forcing vendors to lock in a price a week before auction would result in fewer properties being sold on the street. “I’m not for a minute suggesting that underquoting is all right, because it’s not,” she said. “Forcing a vendor to lock in a decision (on price) seven days prior is a very long time. You’re really taking away a lot of an ’ d d ’ bl Page 1 of 1 agent’s and a vendor’s ability to pivot when they need.” The Real Estate Institute of Victoria was “flabbergasted” the government ignored “commonsense and evidence-based expert warnings” to push ahead with the changes.

REIV chief executive Toby Balazs said the law would have a counter-productive effect. “While the government’s effort to address underquoting and improve the transparency of property transactions are well intended, its decision to move ahead with these laws will result in a real estate market with less transparency,” he d said. The REIV’s position called for a 10 per cent price guide that includes the reserve price of a home be published three business days ahead of auction.

Renters Minister Paul Edbrooke said it was designed to stamp out underquoting, an illegal practice where agents advertised a property at a price they knew to be below the vendor’s reserve.