A real estate agency in Melbourne's trendy inner west has been hit with a $15,000 fine for underquoting as a government crackdown on the practice gathers momentum.
The state's Consumer Affairs department swooped after Village Real Estate's Newport agency sold a Seddon home at auction in February last year.
The agency's directors, Martin Rankin and Hussein Saad, have admitted to contraventions and accepted a $15,000 enforceable undertaking that also requires them to display an acknowledgement of their errors at their office reception.
The enforceable undertaking document details how a weatherboard home at 25 Pilgrim Street was advertised with a selling price of $770,000+ in January 2016, and subsequently with an $800,000+ price.
By then however, the home's owners had already rejected a $900,000 off-market offer and had told the agents the would not consider any offer lower than $950,000.
"The company knew that the vendors were not willing to sell the property at or close to the price suggested and that the property was unlikely to sell at that price," the undertaking states.
On February 6 last year, the home sold at auction for $995,000 after a reserve of $950,000 was set.
The Newport agents are the latest to get stung by Taskforce Vesta, the government's crackdown on underquoting.
Tough new laws targeting underquoting in the real estate sector in Victoria announced last year are set to come into effect this year.
NSW has also introduced laws for underquoting.
"Underquoting is not a smart sales tactic, it's illegal," said Consumer Affairs Minister Marlene Kairouz.
"This undertaking serves as a serious warning to agents doing the wrong thing. There's nothing clever about deceiving people who are making one of the biggest purchases of their life."
In January this year, two Melbourne real estate agencies were fined $45,000 each for underquoting the sale prices of 13 residential properties between 2015 and 2016.There are eight remaining investigation still on foot by the underquoting taskforce.
Consumer Affairs Victoria is currently pursuing legal action against a Footscray agency, also in Melbourne's inner west, over allegations it made misleading representations on the prices of five properties
In October last year, Melbourne real estate agency Hocking Stuart was hit with a record fine of $330,000 for false and misleading representations over property sales.
The Federal Court found the agency's Richmond franchise underquoted on 11 different properties in the eastern suburbs of Richmond and Kew in 2014.
