Underquoting, dummy bidding, false documents: Why ‘Teflon' Sydney agent was suspended
'I'd like to hear what it is. And I'd like to respond back as fully as possible with the truth,' said Tesolin, known among his contemporaries as 'Teflon Josh'.
Now he knows: Dummy bidding, underquoting, high pressure sales tactics and producing false documents to Fair Trading are among the allegations being levelled against one of Australia's top-earning real estate agents.
An extensive investigation by the regulator has landed Tesolin and his private real estate company, Tesolin Consulting, a four-month licence suspension – pending possible disciplinary action – over allegations that he has committed serious and repeated breaches of the law.
Included in the allegations are more than 100 cases of underquoting by Tesolin, all while his corporate interests operated under the Ray White Quakers Hill banner.
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Fair Trading's suspension comes on the day The Sydney Morning Herald and The Age launched Bidding Blind, an exhaustive 18-month data investigation into what has been revealed to be industrial-scale underquoting across Sydney and Melbourne's auction markets.
An investigation by this masthead into Tesolin's business conduct a month ago revealed a unique incentive scheme whereby he charged clients tens of thousands of dollars' extra commission by way of a last-minute incentive payment he said would boost buyer interest.
The scheme meant people who were selling their houses in suburbs such as Quakers Hill and Acacia Gardens had their initial commission of $40,000-plus increased to more than $75,000 and $80,000 as part of the last-minute proposal.
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Sydney Morning Herald
9 hours ago
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The Age
9 hours ago
- The Age
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It effectively allows the agent to game the process while hiding behind the vendor's right to an undisclosed reserve price all the way up to game day. One solution is to tie the reserve price to the agent's estimated selling price. So, as the reserve rises or falls, so does the guide. Better yet, make publishing the reserve before the auction and publishing a guide mandatory. No more opaque references on marketing material to 'call agent'. In Sydney's Inner West, one of the underquoting hotspots unveiled in the Bidding Blind investigation, Mayor Darcy Byrne is calling on the NSW government to force agents to do just those things. 'Buying a house is the single biggest investment people will make in their lives, and they must be able to make decisions based on accurate information, not spin, misinformation and underquoting,' Byrne said. But agents generally prefer the status quo in terms of the auction process because it suits them to have a structured sales campaign with a built-in deadline, and it is seen as a good (and expensive) way to show sellers the value of their home, especially when they are blinded by their own cognitive bias into thinking their home is worth a lot more than anyone else's. If the reserve is published, that would effectively force a lot of sales into a private treaty campaign, at least until overly optimistic homeowners realise their hoped-for price is a dream. At that point, an auction campaign would be an option. An initial private treaty campaign not only saves buyers hundreds of dollars in due diligence for a property that isn't in their budget, but sellers are shown the value of their home without being under pressure to sell under the duress of auction conditions. If our legislators are looking for more improvements, there's the issue of the onerous cost of pest and building inspections. BresicWhitney's Shannan Whitney initiated a push to make these reports free to buyers in 2010, but it hit a hurdle when half his vendors refused to pay for it. The compromise was for BresicWhitney's agents to supply them, bearing the estimated $400 cost, but with a nominal fee on buyers for a copy. Plenty of agencies have followed suit, but if mandated, it would further democratise the practice. Loading Agent training deserves mention, especially after this year's Automatic Mutual Recognition (AMR) Legislation Amendment Bill 2024. The AMR scheme was designed to remove red tape to allow the likes of bus drivers and plumbers from around Australia to work in NSW without the need for state licences. The exception being Queensland, which is not included. The problem is, as Real Estate Institute of NSW chief executive Tim McKibbin recently wrote to the premier, that while skills such as driving and plumbing work similarly across the country, the rules of real estate are different. Fingers crossed, Fair Trading is not inspired by Queensland's solution to underquoting, which is to ban any price guide at all on auction sales. 'That legislation ranks among the worst real estate policy decisions in Australian history,' said McGrath Estate Agents founder and chief executive John McGrath. 'It leaves buyers completely in the dark and actually makes the market less transparent, not more. I genuinely don't understand why transparency is so difficult for some in our industry.' One of the suggestions at the Fair Trading roundtable was that agents pinged for bad pricing should have to pay for a locum-style agent to undertake pricing for them until they can show they're up for the job. Three cheers for that. Less impressive is Fair Trading's suggestion of a 'name and shame' register. This won't work. If agents had any shame to name, they wouldn't be blatantly underquoting anyway.
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- The Age
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