The NSW Government is introducing new real estate underquoting laws designed to give buyers greater transparency and confidence when purchasing a property.

What is underquoting?

Underquoting happens when a property is advertised at a price that’s significantly below what the seller is actually prepared to accept. While not every property that sells above its guide has been underquoted, many buyers have found themselves spending time and money inspecting homes that were never realistically within their budget.

The new laws aim to make advertised price guides more accurate and give buyers better information about how those price guides have been determined.

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What’s changing?

The new reforms will require real estate agents to:

• Include a price or price guide in residential property advertisements (with limited exceptions).
• Provide a Statement of Information explaining how the advertised price guide was     determined.
• Base the guide on comparable recent sales and current market evidence.
• Update the advertised price guide promptly if market conditions or buyer feedback indicate it is no longer reasonable.
• Avoid advertising a price guide below a written offer that has already been rejected by the seller because it was too low.

There are also significantly higher penalties for agents who fail to comply with the new requirements.

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What does this mean for buyers?

These changes should make it easier to:

• Compare properties more confidently.
• Set realistic expectations before attending inspections.
• Spend less time chasing homes that are well outside your budget.
• Make more informed decisions when preparing offers.

While these reforms are a positive step, it’s important to remember that the final sale price will still depend on competition, buyer demand and market conditions. Properties may still sell above the advertised guide, particularly in highly sought-after locations.

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When Will the New Laws Take Effect?

The NSW Government has passed the new underquoting legislation however, the key reforms have not yet commenced. They will come into effect on a future date to be announced by the NSW Government through a formal proclamation. This will give real estate agencies time to update their systems and processes before the new requirements become mandatory.

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Why having a preapproval in place matters

Having your home loan pre-approval in place means you know exactly what your maximum purchase price is before you start making offers. It also allows you to act quickly and with confidence when you find the right property.

As your mortgage broker, we can help you:

• Understand your true borrowing capacity.
• Compare oan options from a wide range of lenders.
• Structure your loan to suit your long-term goals.
• Ensure you any lender specific property restrictions are taken into consideration prior to applying for a loan
• Obtain pre-approval before you start house hunting.
• Provide property valuation & suburb reports to give you more information during your property search
• Be ready to move quickly when the right opportunity comes along.

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Thinking about buying?

Whether you’re purchasing your first home, upgrading, downsizing or investing, understanding these new laws can help you navigate the buying process with greater confidence.

If you’re planning to buy property, get in touch today. We’ll help you understand your borrowing power, secure the right finance and ensure you’re ready when the perfect property comes onto the market.

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