Victoria is set to become the first Australian state to scrap the property market’s sold-price secrecy law, a practice that withholds the final price of a property from public records for months after the sale.
In recent years, the Victorian housing market has seen a slew of new laws favouring renters and homebuyers over agents and vendors, including a requirement for vendors to pay for building and pest inspections and a ban on all forms of rental bidding.
The new law, set for 2027 implementation, aims to lift the sold-price secrecy act in hopes to curb underquoting and create a fair property market.
The law lift will require agents to disclose final sold prices immediately after the sale, rather than months later.
Hailed as a big win for buyers, agents and vendors might be expected to feel the sting.
Sold-price secrecy allows for off-market advantages and overall market distortion, which benefits agents in setting a low benchmark for future property listings.
It also protects their reputation if a property undersells.
Buyers have long been left in the dark, with sold prices often listed as ‘withheld’ or ‘contact agent’.
Without access to recent comparable sales, buyers are left in the dark and unable to properly gauge property prices.
This leaves room for buyers to overpay, and undertake disadvantaged negotiations, while agents’ underquoting attracts potential buyers.
Consumer Affairs Minister Nick Staikos said the change aims to create a safer and fairer property market.
“Buying a house is stressful enough – so we’re making it fairer by requiring the sold prices of homes to be disclosed,” Mr Staikos said in realestate.com.
Real Estate Institute of Victoria Chief Executive Toby Balazs said lifting the curtain on sold-price secrecy will allow buyers to make better-informed decisions.
“‘Price withheld’ is a term that we too often see on recently sold residential property listings,” Mr Balazs told realestate.com.
“By significantly limiting this practice, this change will help to lift the curtain on current market data that can help stakeholders make better informed decisions.”
Mr Balazs said removing the secrecy will help curb the inflated reserve prices and reintroduce transparency to the market.
“We continue to strongly advocate for the roll-back of the government’s proposed mandatory seven-day reserve price disclosure requirement for auctions,” Mr Balazs said.
“Having the potential to trigger inflated reserve prices, a fall in clearance rates and an increase in offers prior to auction, this flawed requirement threatens to compromise the transparency and effectiveness of the public auction process.”