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Victoria's real estate sector is witnessing its biggest transformation in decades! A newly announced regulation is quietly reshaping Victoria's – and potentially all of Australia's – property purchasing rules.

Victorian Government Announces Groundbreaking Reform:

Reserve Price Disclosure Required Before Auction

In recent years, Victoria's property market has remained highly active, with auctions becoming the preferred transaction method for many buyers and sellers. However, the widespread practice of "underquoting" – advertising properties below their realistic value – has misled buyers into blind bidding wars and undermined market fairness and transparency.

To address this long-standing issue, the Victorian government recently announced a major reform!

Core Policy Change:

All Victorian properties scheduled for auction must now publicly disclose their reserve price 7 days before the auction date.

This means buyers can clearly understand the seller's minimum price before participating, enabling better budget assessment and preventing盲目竞价 (blind bidding).

Government authorities emphasize this will significantly reduce buyer misinformation caused by underquoting, making the bidding process fairer and more transparent.

Background Context:

Underquoting occurs when sellers or agents advertise properties below actual price expectations to attract more buyers. This misleads buyers about property value, wasting their time and effort in preparing for auctions, and often results in final prices far exceeding expectations – leading to frustration and complaints.

Victorian Consumer Affairs Minister Nick Staikos noted this legal reform stems from the 2023 "Underquoting and Auction Integrity Forum" and represents a key solution long advocated by industry veterans.

2. Underquoting is Illegal: Over 5,000 Complaints Annually

Underquoting – where agents deliberately advertise properties below estimated market value or seller reserve prices – already violates Victorian law, but the government acknowledges widespread industry non-compliance.

A specialized task force established in late 2022 has received over 5,000 complaints, indicating significant consumer dissatisfaction.

Many homebuyers describe feeling "frustrated," "exhausted," and "cheated" after repeatedly encountering final prices "far exceeding advertised ranges." Such experiences add extra pressure to the already challenging home-buying journey, particularly for young families and first-home buyers.

Why 7-Day Disclosure?

The official explanation notes that typical property sales campaigns last about four weeks, giving sellers ample time to assess market response. The 7-day requirement provides buyers sufficient time for due diligence, including property inspections and loan approvals.

The reserve price disclosure will only apply to auctions and fixed-date sales, not private treaty negotiations.

Once legislated, Victoria will become Australia's pioneer in enhancing real estate auction transparency, with expected profound market impact. Other states will likely follow suit with similar policies.

3. Support and Skepticism: Challenges Remain

The policy announcement has generated mixed reactions:

Supporters believe this represents significant progress in protecting buyer interests and promoting market fairness.

Opponents worry it may create new problems without eliminating underquoting entirely.

Supporting Views:

Consumer advocacy groups and senior buyer advocates welcome the change

Cate Bakos, President of the Real Estate Buyers Agents Association of Victoria, calls it "one of the most significant reforms" she's seen

Veteran anti-underquoting campaigner John Keating views this as a crucial first step reflecting regulatory attitude shift

Buyer agent David Morrell describes it as the biggest change since banning dummy bidding

Green Party MP Gab de Vietri applauds the transparency initiative

Opposing Concerns:

Ray White Victoria CEO Domenic Belfiore calls mandatory disclosure "reckless," potentially driving sellers to set higher reserves and deterring buyers

Real Estate Institute of Victoria President Toby Balazs advocates more comprehensive solutions balancing buyer-seller interests

Opposition Leader Jess Wilson considers it merely "marginal adjustment" failing to address housing affordability

Some industry voices warn sellers might shift to private sales to avoid regulations, reducing transparent auction opportunities

Several buyer agents note 7 days remains tight for thorough due diligence

Conclusion

Victoria's reserve price disclosure policy represents a significant attempt to address long-standing underquoting practices. It signals commitment to fairness and transparency while providing buyers with better information protection.

However, implementation still faces challenges in balancing multiple interests and execution details. The specific legislative provisions, enforcement intensity, and market adaptation will determine its effectiveness. Meanwhile, Victoria's property price pressures, supply-demand conflicts, and buyer-seller negotiations will continue – with policy reform being just the beginning of problem alleviation.

Ultimately, Victoria's initiative undoubtedly provides reference for other states. This reform is expected to promote a healthier, more transparent, and fairer real estate transaction environment, helping more buyers achieve their "dream of home ownership" with greater peace of mind.