Executive summary
You’ve seen the stories. Maybe it has even happened to you recently. The agent’s price guide is $2m. You go to the auction and the property sells under the hammer for $2.5m.
Underquoting remains a persistent friction point in Sydney’s property market, but stronger enforcement and proposed six‑figure penalties in New South Wales aim to lift transparency and deter misleading price guides. As buyers’ agents based in Leichhardt, we act solely for buyers, redressing the information and bargaining imbalance that typically favours sellers. We ensure that our clients are equipped with evidence‑based pricing intelligence throughout a campaign. Accordingly, we welcome any changes that help buyers.
What underquoting means today in NSW
Underquoting occurs when a selling agent advertises or states a likely selling price below the agent’s reasonable estimated selling price for a property, which must be recorded in the agent’s selling agency agreement with the vendor and supported by evidence such as comparable sales and market conditions. Advertising cannot use misleading terms such as “offers over”, “offers above”, or “$X+”, and any quoted price range must be no wider than 10 percent between the low and high ends under the Property and Stock Agents Act 2002 framework and NSW Fair Trading guidance. Agents are obligated to revise and update guides when new information renders the original estimate unreasonable, such as higher offers being received.
What we see in practice
Despite the current legal framework which has been in place since 2016, buyers frequently encounter guides at or below the lower edge of the legal range, sometimes followed by late‑campaign revisions that leap materially, often after early inspections generate stronger feedback., This disadvantages unrepresented buyers who anchor to initial guides, sometimes spending considerable sums on building and strata reports based upon lower price expectations. NSW Fair Trading has flagged increased audits and compliance focus, reflecting persistent complaints and market scepticism. We regularly observe scenarios where an initial price guide does not reflect up‑to‑the‑minute comparable evidence, underscoring the importance of independent buyer diligence rather than reliance on seller‑side estimates.
It is not difficult to understand the motivation behind low price guides: The lower the price guide, the higher the volume of buyer interest. This serves the selling agent twofold: It means more competition for the property and therefore a higher selling price; perhaps less obvious is the fact that it also allows the selling agent to expand their database and potentially engage with more prospective “would be sellers”.
How we navigate price guides for clients
We build an independent estimated selling price using recent comparable sales adjusted for lot size, land value component, orientation, improvements, condition, and date of transaction. We apply qualitative adjustments to derive a target selling zone rather than a single anchor. We monitor live indicators—registered interest, contract requests, building and pest report downloads, and agent behavioural cues—to update price sensitivities and we advise our clients on strategic bid limits and when to walk away. Through our network, we often identify other local selling agents who may have been interviewed by the sellers prior to their selection. Being independent to the sale, their insights and observations can prove to be invaluable.
Because we act solely for buyers, we provide unconflicted advice and negotiation, restoring the balance against the seller’s agent who is engaged and duty‑bound to the vendor’s interests. This aligns with our practice mission and service proposition as buyers’ agents in Sydney’s Inner West.
The government’s proposed changes
The NSW Government has outlined proposals to increase penalties for blatant underquoting to a maximum of $110,000 (up from $22,000), signalling a substantial uplift from existing sanctions designed to deter non‑compliance and repeated offending behaviour in campaigns. Public discussion has also canvassed a “name and shame” style register to list sanctioned agents and greater transparency measures around estimated selling prices and revisions, following a broader compliance crackdown across 2025. NSW Fair Trading has convened an underquoting roundtable with stakeholders, with the most recent session on 13 November 2025. This suggests continuing refinement of enforcement and industry practice standards over the coming months. Stay tuned for more developments in this space.
Existing regime: key rules buyers should know
- An estimated selling price must be included in the agency agreement with the seller as a single figure or a range no wider than 10 percent, supported by evidence such as recent comparable sales and current market conditions, with records retained to justify the estimate and any revisions. Do not be afraid to ask the selling agent to confirm their estimated selling price as per their agency agreement. We have found that most agents will disclose this information if you ask them.
- Advertising cannot use “offers over”, “offers above”, “$X+” or similar statements; guides must be revised promptly if circumstances change, and all marketing must be updated to reflect current estimates without delay.
- If challenged, agents must substantiate the reasonableness of the estimated selling price and any differences between the estimated selling price and final sale price in the circumstances, which is central to audit and enforcement action by Fair Trading.
What the proposed reforms would change for buyers
A six‑figure maximum fine materially raises the cost of non‑compliance. This should reduce incentives to publish optimistically low guides designed to stimulate enquiry volume at the expense of transparency for buyers. A public sanctions register would let buyers quickly identify repeat offenders, improving market discipline and trust while enabling buyers’ agents to calibrate diligence and negotiation strategies against agency track records. Combined with increased audits, these measures are likely to compress the gap between low guides and eventual sale prices, reducing last‑minute guide lifts that currently frustrate campaign planning for buyers.
Our suggestions to improve transparency further
- Tie auction reserves to the official 10 percent estimated selling price range or require contemporaneous disclosure of reserve movement at the time of any public guide revision, creating a clearer anchor for buyers while still allowing vendors to change reserves within lawful parameters as evidence emerges.
- Mandate timestamped publication of estimated selling price evidence summaries—core comparable sales, adjustments applied, and rationale for revisions—so buyers can understand the basis for guides without accessing seller confidentials, with updates required within 24 hours of material information events.
- Implement a public compliance dashboard that lists audits, infringements, and remedial actions for a rolling two‑year period, supporting informed selection of agencies by vendors and enabling buyers to assess the reliability of guides in advance.
How we advocate for buyers in Sydney
As Inner West‑based buyers’ agents, we combine local market intelligence with rigorous price assessment methodology across the Inner West, Eastern Suburbs, and North Shore, ensuring that our clients engage with realistic price targets rather than marketing estimates. We negotiate exclusively for buyers, manage due diligence, and align bidding strategies with independently derived selling zones, safeguarding clients from overpaying due to low initial guides or late guide escalations. Our approach is designed to restore parity in negotiations where vendors are professionally represented, giving buyers disciplined tactics, objective pricing, and transaction management from shortlist to settlement.
Practical steps buyers can take now
- Treat price guides as starting hypotheses, not valuation facts; build an independent range grounded in the most recent, most comparable sales and apply qualitative adjustments for land, improvements, and micro‑location.
- Track guide changes and agent communications closely; rapid upward revisions often signal escalating competitive pressure that should feed into revised bid limits or alternative property options.
Our position
We support greater transparency for buyers, including a public register, because these measures align with a fair market where buyers can make informed decisions without being anchored by artificially low guides. Until reforms are enacted and embedded, buyers should assume that guides may shift during a campaign and should operate with independent, evidence‑based pricing and disciplined negotiation frameworks. This is precisely how we represent our clients’ best interests across Sydney. For buyers seeking an edge in the Inner West and across the city, our sole‑agency representation model delivers clarity, confidence, and competitive execution in an environment where transparency is improving but still uneven.
