For years, Australian home buyers have faced the frustration of finding their dream property, only to discover at auction that the seller expects significantly more than the advertised price guide.

Now, Victoria has introduced major changes to property auction laws designed to tackle underquoting and bring greater transparency to the property market.

Under the new rules, sellers must reveal their reserve priceat least seven days before an auction, giving buyers a much clearer indication of what they may need to pay.

But could these changes reshape the way Australians buy property, and will other states follow Victoria's lead?

What Are the New Victorian Auction Laws?

The new legislation came into effect in October 2026, introducing several important changes to the way residential properties are marketed and sold.

The key changes include:

• Reserve prices disclosed before auction: Real estate agents must publish the seller's reserve price at least seven days before an auction or fixed date sale.
• Clearer advertised prices: Once the reserve is published, advertising must display the actual reserve amount rather than vague pricing such as "offers over".
• Greater transparency around comparable sales: A new Property Price Statement provides buyers with more detailed information about comparable properties used to determine the estimated selling price.
• Final sale prices made public: Agents must publish the final sale price within seven days after the sale becomes unconditional, with the information generally remaining available for at least 18 months.
• Stronger compliance requirements: Auctions cannot proceed if the reserve price has not been disclosed within the required timeframe.

These reforms aim to make the buying process fairer and reduce the uncertainty that has traditionally surrounded property auctions.

Why Is This Such a Significant Change?

Underquoting has long been a frustration for Australian property buyers.

It's not uncommon for a property advertised with a price guide of $900,000 to attract buyers with that budget, only for the reserve to be set considerably higher.

By that stage, prospective purchasers may have already spent money on building and pest inspections, contract reviews and other costs associated with preparing to purchase.

The new Victorian laws aim to reduce these situations by giving buyers more accurate information before they invest their time and money.

For first-home buyers in particular, this could be a welcome change.

Does This Mean Properties Will Sell for Their ReservePrice?

Not necessarily.

While sellers must disclose their reserve price before auction, this doesn't mean the property will sell for that amount.

If multiple buyers compete for the same property, bidding can still push the final sale price well above the reserve.

Sellers also retain some discretion over whether to accept an offer, although existing consumer protection laws continue to apply.

The major difference is that buyers now have a clearer starting point when assessing whether a property is realistically within their budget.

Could There Be Some Unintended Consequences?

While the reforms have been welcomed by many buyers, some property industry experts have raised concerns.

One possibility is that more sellers may choose private treaty sales or expressions of interest campaigns rather than traditional auctions.

This could allow some properties to be marketed without the same requirement to publish a reserve price.

There are also concerns that sellers may set higher reserves to protect their negotiating position.

It's still early days, and the full impact on Victorian auction activity and property prices remains to be seen.

Will NSW and Other States Follow?

Victoria's reforms could place pressure on other Australian states to review their own property sale regulations.

NSW has already announced its own changes aimed at improving price transparency and cracking down on underquoting.

These include mandatory advertised price guides, additional comparable sales information and significantly increased penalties for underquoting.

While the NSW reforms are different from Victoria's new reserve price requirements, both states are moving towards greater transparency for property purchasers.

If Victoria's changes prove successful, it may encourage further reform across Australia.

What Does This Mean for Homebuyers?

Greater transparency is a positive step, but knowing the reserve price is only one part of buying a property.

Before attending an auction, it's important to:

• Understand your borrowing capacity and have your finance organised.
• Set a realistic maximum purchase price based on your financial circumstances.
• Research comparable property sales rather than relying solely on advertised price guides.
• Allow for additional purchasing costs, including stamp duty, legal fees and inspections.
• Avoid emotional bidding that could push you beyond your comfortable budget.

Remember, a lender's valuation may not always match the price you agree to pay, particularly in a competitive auction.

And because auction purchases are generally unconditional, having your finances properly assessed before hand is particularly important.

Our Thoughts

At Assured Lending Mortgage Brokers, we believe greater transparency is a positive development for Australian home buyers.

Buying a property is one of the biggest financial decisions most people will ever make, and buyers deserve accurate information to help them make informed decisions.

While Victoria's new auction laws won't eliminate competition or guarantee lower property prices, they could help reduce wasted time, unnecessary expenses and unrealistic expectations.

We'll be watching closely to see whether similar reserve price disclosure requirements eventually make their way to NSW and the other states.

Planning to Buy a Property?

Whether you're purchasing your first home, upgrading, downsizing or investing, understanding your borrowing capacity before making an offer is essential.

At Assured Lending Mortgage Brokers, we can help you compare lenders, understand your finance options and prepare for your property purchase with confidence.

Contact Assured Lending Mortgage Brokers today for a free, no-obligation home loan consultation.

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