Underquoting in Victoria: The Costly Game Buyers Shouldn’t Have to Play

Underquoting is when a property is advertised at a price that is less than the agent’s estimated selling price, or less than the seller is willing to accept.

In Victoria’s property market, it has become one of the most damaging practices for buyers. On the surface, it might look like a clever tactic to drive competition, but in reality, it erodes trust, wastes money, and fuels the growth of unethical agency practices.

Buyers invest heavily in building inspections and legal checks only to discover that the property was never realistically available at the quoted price. Beyond wasted money, it’s the lost time and emotional toll that really hurts. Meanwhile, the agents who engage in underquoting quietly benefit — not from sales alone, but from collecting valuable buyer data that can be used to grow their business at the expense of honesty and transparency.

Why Underquoting Persists

The sad truth is that underquoting is remarkably easy to get away with in Victoria. As Consumer Affairs Victoria (CAV) explains:

“A seller can choose not to tell their agent their asking or reserve price during the marketing campaign. The seller's reserve price is usually set on the day of the auction. It may be higher than the advertised price.” Source: Consumer Affairs Victoria

This law creates a convenient loophole. Agents can advertise a property at an “acceptable” range, while the real figure — the vendor’s reserve — sits much higher, well beyond buyers’ expectations. And in the overwhelming majority of cases, sellers do have a price in mind from the very beginning. Otherwise, they would never agree to spend $5,000 or more on marketing before going to market. While there may occasionally be sellers who are genuinely undecided, this is the rare exception — not the rule.

How It’s Done

The process begins long before a property hits the market. When an agent meets with a seller, their first goal is to win the listing. To do this, many agents promise a high eventual sale price — the figure every homeowner wants to hear.

As part of that pitch, they introduce a strategy: if the property is advertised at a lower price, it will attract more buyers, generate more competition, and ultimately push the price up. Sellers, understandably tempted by the promise of both strong interest and a big result, often agree.

From there, the paperwork makes it simple. On the written agreement between the agent and seller (the Exclusive Sale Authority), instead of recording a clear “Vendor’s Authorised Price,” the agent writes “TBA” (to be advised). On paper, this suggests the vendor hasn’t yet decided on a price. In practice, it gives the agent complete flexibility to quote well below the owner’s true expectations, without leaving a paper trail.

This simple combination — promising a high result, persuading the seller to play along, and leaving the official price blank — is what allows underquoting to thrive.

The Role of SOI’s

Every campaign must include a Statement of Information (SOI), which is meant to guide buyers with comparable recent sales. But this safeguard is undermined when the agent cherry-picks the data. Underquoting agents frequently select the lowest or least comparable sales to justify their underquoted range, leaving out stronger or more relevant sales that reflect the true market.

As a result, the SOI — which should protect buyers — is instead used to give the illusion of compliance while supporting an artificially low price guide.

(Note: There are cases where there may be limited comparable data but in most circumstances agents have options - and choosing only the lowest sales misleads buyers)

Clearing Up a Common Misconception

One of the biggest misconceptions buyers have is that fixing underquoting would mean knowing exactly what a property will sell for. That’s not true. The final selling price will always be determined by market conditions and the agent's ability to negotiate the buyer's highest price.

Underquoting is something very different. It occurs when a property is knowingly advertised below the seller’s expectations to manufacture interest. And it’s not just an auction problem. Underquoting happens just as often in private sales, where buyers may spend weeks negotiating around an unrealistic price guide that was never close to the vendor’s real bottom line.

Fixing underquoting doesn’t mean eliminating uncertainty in the market — it simply means eliminating false advertising.

How It Could Be Stopped

The irony is that stopping underquoting would be simple. Sellers almost always know what they want to sell for. If legislation required that the vendor’s acceptable sale price (or reserve) be disclosed at the beginning of the campaign and maintained throughout, buyers would at least know whether they were in the right ballpark or completely wasting their time, looking at properties they can't afford.

Even if the market drove the eventual sale higher, the starting point would be honest. Transparency would replace guesswork, and trust could begin to rebuild.

What You Can Do

If you suspect a property has been underquoted, you can report it directly to Consumer Affairs Victoria using their online form: Report suspected underquoting.

The more buyers who take the time to report these practices, the harder it becomes for underquoting to be ignored.

What Do You Think?

Underquoting continues to waste money, time, and energy for everyday buyers in Victoria. But it doesn’t have to.

Have you experienced underquoting yourself? Did you waste time and money chasing a property that was never really within the advertised range? And do you think sellers who knowingly participate in underquoting should also be held liable? I’d love to hear your thoughts and experiences in the comments below.