Price indications - agents cannot mislead
I was rather pleased to see this tweet from the Real Estate Agents Authority (REAA) today:
The statement is incredibly valid and prompted me to write as over the last couple of weeks I have heard from a number of readers about their frustration about the price search parameters on web searches on both property portals and real estate company websites.
An agent not only has to be accurate and must not lead around price expectation of sellers when discussing with buyers at open homes but also should ensure this mis-representation does not occur on web searches which are so critical given the vast majority of buyers search for property online.
To be specific the REAA on their website sets out the "Expected behaviour of Real Estate Agents"
Here are the statements that are pertinent to this issue:
Agents can’t withhold or give inaccurate information about a property
The agent is in contract with the seller and will always work on their behalf. However, they have an obligation to treat the buyer fairly, including not withholding, or giving inaccurate, information.
(I think this is important in the context around not withholding information, an accurate price expectation is information which when requested must not be withheld)
Agents can’t make unsubstantiated representations
Under the Fair Trading Act, it is an offence for an agent to make an unsubstantiated representation about a property. This means that an agent can’t make a representation about a property without having the evidence to back it up.
Agents must have reasonable grounds for making a statement (written or verbal) about a property - before they make it.
(I think that as each property requires a market appraisal undertaken by the agent for the vendor at the time of listing which provides an indicative sale price / price range then under the Fair Trading Act the evidence to back up any reference to price needs to reflect the evidence of this appraisal so the two should be aligned and therefore the search price online should be substantiated by this evidence)
Agents can’t mislead buyers and sellers about pricing expectations
The advertised price for the property must be in line with the pricing expectations the agent has agreed with the seller. The agent should not mislead the buyer about the seller’s pricing expectations.
(I believe as I have stated that the search price range online is as valid as response to setting buyer expectation as is a verbal communication)