Latest news with #RealEstateInstituteofNSW
Sydney Morning Herald
4 days ago
- Business
- Sydney Morning Herald
How to fix Sydney's broken real estate selling system
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.
The Age
4 days ago
- Business
- The Age
How to fix Sydney's broken real estate selling system
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.
The Age
11-08-2025
- Business
- The Age
Real estate underquoting: Industry leaders back calls to reveal auction reserve prices after report
He also said if a vendor insisted on a higher price than an agent recommended, this should be published too. 'Essentially, it turns the process into a private treaty one and will take longer to sell. Once the property has been on the market for long enough, and if it's unsold, then the auction process can be introduced once the price gap has narrowed.' McGrath Estate Agents founder and chief executive John McGrath strongly supported any changes that created greater transparency, but said sellers should retain the right to accept or reject any offer. 'The real issue isn't reserve pricing, it's agent compliance with existing price guide regulations,' McGrath said. 'If agents follow a straight bat with current quoting rules, transparency issues largely disappear.' On Monday, Premier Chris Minns said he reserved the right to look at legislation that would force agents to publish the vendor reserve before auction, but there were no immediate plans to do it. Premier Chris Minns at Burwood Park on Monday. He has not ruled out a look at publishing reserve prices. Credit: Steven Siewert The NSW Office of Fair Trading is looking at potential industry reforms by way of a series of roundtable forums with stakeholders. Key among those measures are increased penalties for underquoting and a similar model to Victoria that offers better pricing guides for buyers. Tim McKibbin, chief executive of the Real Estate Institute of NSW, is among those working in the background with Fair Trading on the reform process. 'What I can say is that we are committed to finding a solution, everything is on the table and some encouraging progress has been made,' said McKibbin. McKibbin's industry lobby group chief counterpart in Victoria, Jacob Caine, revealed on Sunday that the institute would support the introduction of reserve price disclosure as well the adoption of a new model that would provide free building and pest reports to prospective home buyers. The rules around property pricing are tighter in Victoria than in NSW. Victorian legislation makes price guides mandatory on marketing, and price estimates must be accompanied by a statement of information showing comparable sales that inform the estimate. In NSW, Liberal leader Mark Speakman said he would consider the issue of whether vendor reserves should be published, but as yet the party hadn't committed to a position. Start the day with a summary of the day's most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.
Sydney Morning Herald
11-08-2025
- Business
- Sydney Morning Herald
Real estate underquoting: Industry leaders back calls to reveal auction reserve prices after report
He also said if a vendor insisted on a higher price than an agent recommended, this should be published too. 'Essentially, it turns the process into a private treaty one and will take longer to sell. Once the property has been on the market for long enough, and if it's unsold, then the auction process can be introduced once the price gap has narrowed.' McGrath Estate Agents founder and chief executive John McGrath strongly supported any changes that created greater transparency, but said sellers should retain the right to accept or reject any offer. 'The real issue isn't reserve pricing, it's agent compliance with existing price guide regulations,' McGrath said. 'If agents follow a straight bat with current quoting rules, transparency issues largely disappear.' On Monday, Premier Chris Minns said he reserved the right to look at legislation that would force agents to publish the vendor reserve before auction, but there were no immediate plans to do it. Premier Chris Minns at Burwood Park on Monday. He has not ruled out a look at publishing reserve prices. Credit: Steven Siewert The NSW Office of Fair Trading is looking at potential industry reforms by way of a series of roundtable forums with stakeholders. Key among those measures are increased penalties for underquoting and a similar model to Victoria that offers better pricing guides for buyers. Tim McKibbin, chief executive of the Real Estate Institute of NSW, is among those working in the background with Fair Trading on the reform process. 'What I can say is that we are committed to finding a solution, everything is on the table and some encouraging progress has been made,' said McKibbin. McKibbin's industry lobby group chief counterpart in Victoria, Jacob Caine, revealed on Sunday that the institute would support the introduction of reserve price disclosure as well the adoption of a new model that would provide free building and pest reports to prospective home buyers. The rules around property pricing are tighter in Victoria than in NSW. Victorian legislation makes price guides mandatory on marketing, and price estimates must be accompanied by a statement of information showing comparable sales that inform the estimate. In NSW, Liberal leader Mark Speakman said he would consider the issue of whether vendor reserves should be published, but as yet the party hadn't committed to a position. Start the day with a summary of the day's most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.
Sydney Morning Herald
10-08-2025
- Business
- Sydney Morning Herald
Real estate? Come on, let's get real: Underquoting has caused so much pain to buyers
Having recently seen my two adult children go through the costs, pain and frustration of missing out on property purchases, I can't help but wonder how it has come to this ('False hope, savings wasted in underquoting capital', August 9). Other than works of art, I can't think of anything else sold with a 'price guide'. Price guides are clearly fictitious and do not even reflect the sellers' expectations of the sale price. They are just a lure to attract more eyes to the property. Why can't we just ban price guides altogether and go back to the old method of naming a price and haggling? We all know that scene from Monty Python's Life of Brian, right? The seller names their asking price; usually high and beyond expectation, with buyers negotiating downward from there. At least this way the upper limit is set. Warwick Spencer, West Pymble There is something seriously wrong with a real estate system that allows (encourages?) those selling to have a $1.25 million 'price guide', a reserve of $1.425 million and then sell for $1.559 million. To encourage more accurate price guides and reserves, any amount over these figures should be taxed at 50 per cent. Roger Campbell, Beecroft Having read the article describing the appalling practices carried out by estate agents when advertising properties for auction, a couple of simple legislative amendments could solve the issue and save potential buyers $1000s – and a lot of time. Legislate that the selling agent must provide an independent pest and building inspection report to all potential buyers, eventually paid for by the winning buyer; second, the price guide be set within 2 per cent of the sellers' reserve price, this would at least give prospective buyers confidence that they were truly in the market and prevent many buyers who have no chance from wasting their time. Geoff Lindsay, Thurgoona There is a very simple solution to the practice of real estate agents underquoting a price guide for a property. If the government made it a legal requirement that the reserve price must be published on any advertisement and that the highest bid over the reserve had to be accepted, the problem would go away immediately. How about it, Mr Minns? Michael McFadyen, Kareela The Real Estate Institute of NSW seems to have been the only being who was in the dark. Everybody knows to add 20-30 per cent to any quoted house price for Sydney properties on the market. Nothing has changed. Michele Sharp, Bondi Beach Given vast amounts of money are made by governments from outrageously high fees and taxes on real estate transactions, it's a crime there are not tougher rules protecting consumers, studiously enforced. The current rules mentioned in your story are a sick joke. No wonder real estate agents flout them. Tim Egan, Mosman Horrors, heartbreak and humanity Your report regarding British surgeon Graeme Groom's voluntary service to the unfortunate in Gaza is compulsory reading (''It's appalling for humanity': Doctors bear witness to Gaza', August 9). He should be honoured for his service to humanity. Benjamin Netanyahu can paint whatever picture regarding the plight of the Gazans, but his credibility is on the line. We Australians and other fair-minded people around the world are more intelligent to believe heroes like Graeme Groom along with many other volunteers than politicians whose integrity is questionable. Peng Ee, Castle Cove The testimony from the doctors in Gaza is indeed heartbreaking, but I expect any urban war zone would be similar, especially one that involved an entrenched terrorist army using civilians as human shields. The doctors have no way of knowing the circumstances under which these injuries were incurred, including where the victims were, what they were doing and, indeed, who did the shooting. For that, they only have the word of the Hamas arch-propagandists and those who are too scared to say anything other than what the Hamas terrorists order them to say. Shane Shmuel, Elsternwick (Vic) One sentence stood out in David Crowe's account of the litany of horrors taking place in Gaza reported to him by volunteer medical personnel who were there. It was the fact that on July 25 Israeli authorities stopped medical teams taking in any baby formula. How could this ever be justifiable? It is to be hoped it causes pause for thought for those seeing the Gaza conflict as 'complicated' and repeatedly talk of Israel's right 'to defend itself'. Against possible future Hamas fighters possibly? Louise Dolan, Birchgrove Thank you for the reminder of the very special people who work in Gaza to help innocent victims of the current war. How doctors such as Victoria Rose and other volunteers return time after time is beyond me, but I am so grateful for the humanity that they display. The world needs more of them and less of Netanyahu and Trump. Sharon Warner, North Turramurra It's true 'there is no [Arab] country that would want to administer what's left of Gaza after Israel departs', but Rodger Shanahan ('No plan for war's end, so how can it?', August 9) fails to mention that Israel has offered control of Gaza to Arab countries on many occasions since it took control in 1967 and no Arab country has wanted anything to do with Gazans except to use them as pawns against Israel. George Fishman, Vaucluse Rodger Shanahan repeats the claim that there is no plan for the war's end. No Rodger, there is a plan. Israel has made it abundantly clear that it will not accept a two-state solution. That leaves only three options. A one-state solution where all citizens have equal rights, the equally unpalatable solution of one without equal rights, or one with no Palestinians. There are no other options. With relentless bombing, the herding of people into 'safe zones' only to be bombed, the immense destruction, the starvation of the people, Israel is terrorising the Gazans to such an extent that 48 per cent of them now want to leave, even were the war to end. Unpalatable as it may be, what we are seeing in Gaza is an Israeli plan to take the once-in-a-lifetime opportunity posed by Hamas' brutal raid to remove them forever. Hans Knutzelius, Balmain The wholesale destruction of Gaza, once a city much like any other around the world, was shown in all its horror in the photo in the Herald ('Netanyahu, Hamas locked in a dance to the death', August 9). All the innocent lives, amenities and human endeavour lost to the combined madness of a group of fanatics and a few pig-headed politicians. As with the war in Ukraine and other places, it only takes one egoist or nut-case to drag a whole country into conflict with another, whether the populace wants it or not. Sadly, the average civilian doesn't have the powerful connections, networking ability or support forces to make any resistance to these devastating decisions. Donald Hawes, Peel Israel's decision to occupy the remaining section of Gaza is in clear violation of international law. Netanyahu, his rogue clique and enablers (I'm thinking of you, Mr President) need to be held to account for this; and also for Israeli acts of terrorism in the West Bank (where they can't blame Hamas). Israel has acted with impunity since the International Court's 1967 decision on the Israeli-Palestinian conflict. Australia should look to take real action with other nations. Deporting the Israeli ambassador and imposing sanctions should be up for urgent consideration if Israel continues to defy international law. Further razing and illegal settlements will not bring peace. Martin Frohlich, Adamstown Heights Clueless Trump bound to spruik credentials after meeting with Putin Trump is going to meet Putin ('Trump open to Alaska summit with Putin and Zelensky, White House says', August 10). The orange one has already given away his negotiating position by saying a territory swap is on the table. What a pathetic dealmaker he is. He will come out of the meeting saying that 'Vladimir and I have had a very good meeting and it's the best deal that's ever been made. I've stopped more wars than any leader in history. How about my Nobel Peace Prize?' Putin must not be able to believe his luck knowing that TACO. Ukraine won't be invited, of course. I suggest Ukraine should offer to give away Mar-a-Lago in exchange for any deal. John Burman, Port Macquarie President Putin's smile must be extended from ear to ear with the prospect of negotiating with Donald Trump. He was and is the aggressor in the current war and has 'annexed' vast areas of Ukraine, whose president will be banned from 'negotiations'. Donald has already revealed there will be some give and take in the conclusion. Putin, the invader, will be delighted that his war crime has been legitimised. Ferdo Mathews, Robina (Qld) Knowing that Trump has become such an honourable statesman and dealmaker, I imagine he will offer to return Alaska to Russia in exchange for Putin returning Donbas and Crimea to Ukraine. Charles Hargrave, Elizabeth Bay Folbigg: more cruelty The premier asserts that Kathleen Folbigg can sue the government. Well and good, but her legal team have not been provided with the reasons behind the paltry $2 million compensation offer. They are unlikely to get them, considering a cabinet decision-making process. Any court action will be a costly exercise, so the premier could at least offer to pay her legal costs, regardless of the outcome. Surely Folbigg should not have to spend money to chase a better deal. Michael Blissenden, Dural Premier, so you tell us the state can afford to pay Kathleen Folbigg only $2 million for 20 years' jail, but you can close Opal card readers for 54 hours and throw away $7 million of taxpayers' money. Did you think the $7 million should not have been paid to her instead? Not enough votes in that, I guess. Trevor Stephenson East Ballina Different track When the Racing NSW chairperson says the Golden Eagle, like The Everest, will 'become the young generation's must-go event', it is becoming increasingly apparent that both Racing NSW and the ATC is no longer really in racing any more. Randwick is being promoted as a nightclub with some horses running around a track occasionally, while Rosehill is just a course somewhere out west of the city ('Officials strip Rosehill of its biggest race', August 9). George Zivkovic, Northmead Tax luxury goods Sadly, I'm inclined to agree with Peter Hartcher when he opines that there will be no change to the GST coming out of the summit next week because of the PM's reluctance to rock the boat ('PM and Chalmers' reform rift', August 9). But surely a politically safe move would be to increase the GST on luxury items. If I have the money to buy a Lamborghini for $400,000, would I baulk at paying a further 10 per cent over the existing 10 per cent? The task of defining 'luxury items' may take some doing, but surely it's a no-brainer and relatively politically safe to make that change. Brian Roach, Westleigh While Peter Hartcher makes some good points in his article, I don't see a reform rift. The best change happens slowly with buy-in and consultation. The Australian people like changes that make sense and aren't thrust upon them quickly, so that they have enough time to consider implications. Having said that, the fickle nature of parts of the Australian media mean that change shouldn't be rushed. The PM and treasurer appear to have a good working relationship, and both men are doing their jobs. The PM has learnt from the unsuccessful Voice campaign, a noble and just cause that was cheapened and defeated largely by a disingenuous opposition leader and the Murdoch media. Let's not sow division where there is none. It's refreshing to have a government that is talking about the big issues we face. Geoff Nilon, Mascot The Productivity Commission is right to suggest that mining companies should pay tax on their so-called 'economic rents' – that is, on the profits they make that are higher than their minimum expectations ('Productivity Commission wants big mining companies to pay more 'rent'', August 9). But there is another reason why they should pay more: they are producing a 'one-off' product that cannot be reproduced once it's been exhausted. The payment is to compensate future generations for loss of the mineral resource. Of course, the companies would scream all hell if threatened with higher taxes. We should call their bluff. The pittance they pay at present is just a joke. Ken Enderby, Concord Languages triumph Congratulations to Cabramatta High School for having so many students studying a language in the HSC ('Amid falling language enrolments, this school speaks up', August 9). It's great to see that for many of them it helps them to connect to their culture of family origin. However, it worries me that so few in Australia study languages, while as a nation we travel overseas at a higher rate than most. My experience is that learning something (even a little) of another language enhances my enjoyment of travelling and my understanding of their culture, and that once I have shown willing to speak in their language (even if I fail) they are more welcoming and helpful towards me. Judy Christian, The Ponds Still behind The old quote of 'lies, damned lies and statistics' takes on new meaning ('Wallabies are almost back to their best, so bring on Boks', August 9). What apparently now constitutes a series victory against the Lions is winning four of six halves, leading on the scoreboard for 159 minutes and 'winning' the penalty count in two of the three Tests! Can we consign this drivel to the dustbin before it takes hold? The Wallabies were courageous, played some great rugby and gave supporters hope for the future, but the reality is they lost the series 2-1, which is the only statistic that counts. Mike Kenneally, Manly So theatrical Surely, only hairdressers and choreographers might take issue with Malcolm Knox's wonderfully acerbic crit of the increasingly annoying rash of vaudevillian performances sullying rugby league ('Times are trying enough without the fatuous four-pointer choreography', August 9). And he didn't even get started on the bunker. Kent Mayo, Uralla Malcolm Knox for prime minister if he can ban Sweet Caroline. Peter Blore, Orange In for a Halfpenny I have three magic words for Kate Halfpenny ('Want to give great advice? Try using three magic words', August 9): Keep on writing.
