Underquoting — advertising a property at a lower price than the agent and vendor reasonably expect — has been illegal in Victoria since the 2017 amendments to the Estate Agents Act 1980. Agents must publish a Statement of Information (SOI) that discloses the advertised price range, three comparable sales, and the suburb’s median. The penalty for breaches: up to $39,000 per offence and forfeiture of the agent’s commission. Despite this, underquoting remains common — and buyers regularly waste thousands on inspection and legal fees chasing properties priced unrealistically low.
This guide covers the legal framework, what the Statement of Information must contain, the warning signs of underquoting, and how to use the SOI to assess realistic value before bidding.
The legal framework
Section 47A of the Estate Agents Act 1980 (Vic) prohibits agents from advertising a property at a price below:
- The vendor’s asking price (if specified in writing)
- The agent’s estimated selling price (if no vendor asking price)
- Any written offer the vendor has rejected
Consumer Affairs Victoria (CAV) enforces the rules. The Estate Agents (Professional Conduct) Regulations 2018 set the documentation requirements, including the Statement of Information.
What the Statement of Information must contain
Every residential property advertised for sale in Victoria must have a current Statement of Information available to prospective buyers. The SOI must include:
- Indicative selling price. Either a single price or a price range. If a range, the upper number cannot exceed the lower number by more than 10%.
- Three comparable sales. Genuine recent sales of comparable properties (similar size, location, condition) within a defined timeframe (typically 6 months) and proximity (typically 2km).
- Median sale price. The median sale price for the suburb for properties of the same dwelling type (house, unit, apartment) over the previous 6 months.
Reading an SOI for genuine value signals
A Statement of Information is more useful for assessing realistic value than the headline indicative price. Here’s what to look for:
- Comparable sales close to the indicative range. Genuine. The property is likely to sell within or just above the range.
- Comparable sales 15–30% above the indicative range. Suspicious. Either underquoted or comparables aren’t truly comparable.
- Comparable sales much older than 6 months. The agent may be pulling old sales to support a lower price. Check recent sales independently.
- Comparable sales in different suburbs or substantially different specifications. Genuine comparables should match suburb, dwelling type, and core specs.
- Suburb median substantially above range.Either the property is genuinely below median (smaller, worse condition, worse location within suburb) or it’s underquoted.
Common underquoting signals
| Signal | What it suggests |
|---|---|
| Auction range $X–$Y, but recent comparables sold $Y+15% | Likely underquoted |
| Range $X–$Y; suburb median is 25%+ higher | Possibly underquoted |
| Vendor reserve $X+25% over advertised range | Definitely underquoted |
| Multiple inspections each weekend | High demand — final price likely above range |
| Agent verbal “mid-to-high $Y” | Range is the floor, not the realistic price |
| SOI has only 1 or 2 comparables instead of 3 | Non-compliant — challenge with CAV |
What to do if you suspect underquoting
- Cross-check comparables. Use Domain, REA, or CoreLogic to verify the comparables on the SOI are genuine and recent.
- Check the suburb median yourself. Use Domain suburb pages or CoreLogic free reports.
- Ask the agent directly.“What is the vendor’s reserve?” The agent must give an honest answer if known. If the answer is significantly above the advertised range, that’s either a vendor change of mind (legal but should trigger SOI update) or underquoting.
- Walk away from confirmed underquoting. An agent willing to deceive on price is willing to deceive on other material facts.
- Report to Consumer Affairs Victoria. Online form, anonymous reporting available. CAV investigates patterns across multiple complaints.
Auction quoting — the special case
Auction properties pose particular underquoting risks because there’s no asking price — only a guide range. The 10%-spread rule still applies. If the auction range is $1.0m–$1.1m, the vendor reserve cannot be above $1.1m+10%, i.e. $1.21m. In practice, vendor reserves at auction often exceed the upper end of the range, leading to many properties passing in.
Pre-auction strategy:
- Get the SOI well before auction day
- Inspect with comparables in mind
- If you’re considering bidding, set your maximum based on the upper SOI range plus 10%, not the lower
- Prepare to walk away if bidding exceeds your maximum
Buyer-side cost of chasing underquoted properties
Each property you’re seriously interested in costs:
- $600–$1,200 for building inspection
- $300–$800 for pest inspection
- $400–$1,500 for solicitor pre-purchase review
- $200–$500 for council and title searches
- Time off work for inspection and auction attendance
Total spend per chase: $1,500–$4,000+. Underquoting forces buyers to spend on properties they could never realistically afford. Verify realistic value before commissioning paid checks.
Ready to check your contract? Upload your Section 32 or Contract of Sale at precontractreview.com for a pre-contract check — typically in just a few minutes.