Real Estate — Why isn’t this a Bigger Issue?

Property has a great vested interest in keeping the place a snake pit. The Age reports how auction prices are a very poor guide to actual property prices. Money quotes:

 ADVERTISED prices for houses at auction continue to be an extremely poor guide to what buyers actually end up paying, amid claims that consumers are being duped by real estate agents.

A survey of 378 auction results by The Age found that over the past two weekends, the difference between the advertised and final sale price was, on average, 20.7%, despite laws protecting consumers from underquoting and misleading conduct. The latest survey follows six weeks of surveys by The Age in April and May, which found similar results. Then, the average difference was 21.2%.

In the retail business, this would be considered baiting. In the real estate business, its business as usual. The competition watchdog has been doing little to prevent it, and has even been undermined by a Real Estate association, REIV:

Consumer Affairs Victoria last week released new guidelines designed to spell out what agents can or cannot do. Executive director David Cousins said agents had been put “on notice” on how the regulator would enforce the law. But that initiative has been muddied by the REIV, which released its own guidelines six months ago and took the extraordinary step of telling agents to follow their own guidelines rather than those of the regulators.

It surprises me that with all the political banter for how real estate is now ‘unaffordable’ to young Australian families, a fundamental issue on the topic has no solution offered. This pricing deception is exploitation. For all the political rhetoric about fighting for people who wish to own their own house, governments have shown its little other than words and phrases.