How the new laws work

Real Estate Institute (REI) of NSW President John Cunningham says it’s important for both agents and consumers to get their heads around what the changes mean. “Under the new legislation an estimated selling price must be provided in the agency agreement and the agent must give the seller evidence of the reasonableness of this estimate. “Real Estate professionals can do this by providing examples of recent sales in the area and how the property compares,” Cunningham said this week in response to the new laws. “They must show the estimated selling price as a range with an upper limit of no more than 10 per cent of the bottom figure in the range or as a single price. “Agents will no longer be able to be vague in their price guides. You will no longer see offers over used in advertising or quoted to buyers.” However, he says the new legislation does recognise that the market can change and the estimated price must be revised if the current estimate is no longer a reasonable reflection of the likely selling price. In this case, the agent must notify the seller in writing and provide evidence for the revision, then amend the agency agreement with the revised estimate. Any advertisements must be amended with the new estimate as soon as is practicable. “Agents must not communicate or advertise any price information for a property that’s less than their estimated selling price and a seller may instruct an agent not to reveal the estimated selling price to prospective buyers. “If this is the agreed marketing strategy, then the agent should not reveal any price information to buyers, in advertising, in writing or verbally. “It’s common for a vendor to instruct no price guide in the marketing but are happy for their agent to provide price on request.”