To help curb the instances of underquoting by real estate agents, New South Wales Fair Trading introduced stricter laws and increased penalties that started to come into effect 29 June 2026, with further changes expected to start later in the year. The changes to underquoting centre around improving the accuracy and transparency of property prices and holding selling agents accountable for inaccurate or manipulative advertising.
The underquoting laws have been enhanced to ensure that buyers don’t waste time and money on property inspections, getting reports done and attending auctions for properties that will be out of their price range. This has long been an issue for consumers, with real estate agents taking advantage of loopholes to falsely advertise the expected price for a property as a means to generate increased interest and drive the final sale price up.
What is considered “underquoting” under NSW law?
Underquoting is considered any situation where a real estate agent quotes or advertises a price below the agent’s recorded estimate in the agency agreement. An agent is also considered to be underquoting the expected selling price of a residential property if they indicate through statements, advertising or any communications with a potential buyer, a price that is less than their reasonable estimate of the property’s likely selling price.
What the Property and Stock Agents amendment means
The Property and Stock Agents Amendment increases the fines and penalties for agents who are found to be underquoting or for bad conduct, including dummy bids or skipping mandatory training. It also increases the powers for Fair Trading to act against bad agents and imposes new rules around advertising, particularly regarding prices.
Laws regarding advertising and property prices
In advertising, if an agent uses a price range the upper end cannot exceed the lower price by more than 10%. Agents cannot advertise a price lower than a previously rejected written offer or lower than the highest unsuccessful bid at an auction. They are also not allowed to use vague or incomplete pricing terms like ‘offers over’ or ‘$XXX,000+’ as it hides the true expected price. Lastly, agents cannot quote a price lower than what they know the vendor will actually accept.
New underquoting penalties in NSW: $110,000 fines and dummy bidding increases
Under the new property and stock agents laws, there is an increase in maximum court-imposed penalties for many offences. These penalties reach up to $110,000 for a corporation and $55,000 for an individual for some offences, including for acting as an agent without a licence, dummy bidding at auctions, and mishandling trust money.
Agents found guilty of underquoting can face up to a maximum court-imposed penalty of $110,000, or three times the agent’s commission, whichever is higher. There is also a new maximum court-imposed penalty of $11,000 for agents or assistant agents not complying with continuing professional development requirements.
Mandatory price guides on every listing (expected later in 2026)
Real estate agents must include a mandatory price or price guide on all residential property advertisements. If quoting a price range, the high estimate cannot exceed the low estimate by more than 10%. When determining the price guide, the new laws require agents to consider the sold prices of comparable properties and will also need to ensure that their estimated selling price for a property is, and remains, a reasonable estimate of the likely selling price of the property. They will also need to keep certain records in relation to determining or revising their estimated selling prices.
Statements of information
Agents who are engaged to sell a residential property will be required to prepare a Statement of Information for the property (SOI). The SOI is there to help buyers understand how the selling price was calculated, including comparable sales and the suburb’s median sale price.
Agents are required to include the Statement of Information for the property (or a link to it) in online advertisements for the sale of the property. The Statement of Information must be displayed in a prominent place at property inspections and agents must provide a copy of the Statement of Information to prospective buyers within 2 business days if they request it, or a copy of the sale contract.
Agents’ duty to update estimates
The agent must update the price estimate if ongoing buyer interest or feedback indicates the price guide is too low. They are required to amend price guides if the local property market changes or new comparable sales show higher values, or if a formal written offer or auction bid is rejected and is higher than the currently advertised price guide.
Agents need to update, or remove, advertisements to ensure they remain compliant with all requirements throughout a sale campaign. They will need to do this within one business day for online advertisements and as soon as practicable for other advertisements.
What the new underquoting laws mean for buyers, sellers and agents
The new underquoting laws are a good step forward in holding sellers and agents accountable for their actions when advertising a property. They increase the transparency for buyers to better understand realistic selling prices and help sellers to be better informed when setting reserves or sale prices.
For agents, the new underquoting laws mean they are no longer able to use misleading price guides to drive increased interest in a property. They are required to complete ongoing training and will face much harsher punishments for non-compliance or for bad conduct. The end result is a fairer system that improves the accuracy of advertised property prices.
Some information contained in this article relates to reforms introduced under the Property and Stock Agents Amendment (Underquoting and Other Agent Conduct) Act 2026 that are expected to commence later in 2026.
Requirements relating to mandatory price guides, Statements of Information and certain advertising practices may not yet be in force at the time of publication. Readers should refer to the latest NSW Fair Trading guidance for current requirements.
To stay up to date with the latest property and stock agent reforms, readers can subscribe to updates from NSW Fair Trading via the NSW Fair Trading Stay Informed page.
