smh.com.au
REIV Backs Reserve Price Disclosure to Combat Underquoting
The Real Estate Institute of Victoria (REIV) now supports disclosing reserve prices before auctions and providing free building and pest reports, responding to an investigation showing widespread underquoting in Victoria and costing buyers thousands of dollars.
- What is the immediate impact of the REIV's support for reserve price disclosure on the Victorian real estate market?
- The Real Estate Institute of Victoria (REIV) now supports disclosing a home's reserve price before auction, a significant shift driven by evidence of widespread underquoting. This policy change, along with a proposal for free building and pest reports, aims to address buyer frustrations and wasted expenses from misleading price guides. The REIV's about-face follows an investigation revealing that Victorian homebuyers frequently encounter unrealistic price guides.
- How does the REIV's policy shift connect to broader concerns about transparency and consumer protection in the Victorian property market?
- The REIV's support for reserve price disclosure directly responds to The Age's investigation analyzing over 26,000 property sales, demonstrating the scale of underquoting in Victoria. The proposed free building and pest reports aim to mitigate the financial burden on buyers who often pay for multiple inspections due to inaccurate price guides. This aligns with recommendations from the Consumer Policy Research Centre, further highlighting the systemic problem and the need for reform.
- What are the potential long-term consequences of implementing mandatory reserve price disclosure and free building and pest reports on the Victorian housing market?
- Mandatory reserve price disclosure, coupled with free building and pest inspections, could significantly alter Victoria's real estate market by increasing transparency and reducing buyer costs. The REIV's policy shift, following years of opposition, shows the mounting pressure for change and the potential for improved consumer protection in the future. This reform could lead to a fairer and more efficient auction process.
Cognitive Concepts
Framing Bias
The article frames the REIV's policy shift as a positive development, emphasizing its potential benefits for buyers and aligning it with the findings of "The Age's" investigation. The headline and introduction immediately highlight the REIV's support for reserve price disclosure, presenting this as a significant step towards resolving underquoting. The negative aspects of the current system are emphasized, while potential drawbacks of the proposed solution are downplayed. The Attorney General's comments about "dodgy operators" contribute to this framing.
Language Bias
The article uses some charged language. Terms like "dodgy operators" and descriptions of underquoting as "misleading" or an "illegal practice" carry negative connotations. While these terms might accurately reflect the situation, more neutral alternatives could be used to maintain objectivity. For example, "agents who violate underquoting laws" could replace "dodgy operators.
Bias by Omission
The article focuses heavily on the REIV's policy shift and the issue of underquoting, but omits discussion of potential counterarguments or alternative solutions. While acknowledging the $400,000 government review, the article doesn't detail its content or reasons for non-release beyond the government's refusal to comment. This omission could limit a complete understanding of the situation and potential solutions outside the REIV's proposed changes. The perspectives of real estate agents who might disagree with the REIV's stance are also absent.
False Dichotomy
The article presents a somewhat simplified eitheor framing by focusing primarily on the REIV's proposed solution (reserve price disclosure and free building/pest reports) and the government's response. It doesn't fully explore the complexities of the issue, such as the potential downsides of mandatory reserve price disclosure or alternative regulatory approaches that could achieve similar goals. The opposition's suggestion of a price band is mentioned briefly but not fully analyzed.
Sustainable Development Goals
The article highlights the issue of underquoting in the Victorian real estate market, where advertised prices are lower than the actual reserve price. This practice disproportionately affects vulnerable buyers, such as first-home buyers or those unfamiliar with the area, leading to financial losses and wasted time. By advocating for transparency through reserve price disclosure and free building and pest reports, the Real Estate Institute of Victoria (REIV) aims to create a more equitable market, protecting buyers from exploitation and reducing the financial burden on those with fewer resources. The proposed reforms directly address the unequal power dynamic between buyers and sellers, promoting fairness and access to housing.