smh.com.au
Sydney Real Estate: Rampant Underquoting Costs Buyers Millions
A Herald investigation exposes rampant underquoting in Sydney's real estate market, with 48 percent of properties selling for over 10 percent above the quoted price, costing buyers significant sums and highlighting inadequate regulations.
- What is the extent of underquoting in Sydney's real estate market, and what are its immediate consequences for buyers?
- An 18-month investigation by the Herald reveals that 48 percent of Sydney properties sold between January 2024 and June 2025 fetched more than 10 percent above their quoted prices, with 16 percent exceeding the guide by 20 percent or more. This widespread underquoting costs buyers time, money, and resources spent on inspections ultimately proving futile.
- How effective are the current regulations in NSW aimed at curbing underquoting, and what factors contribute to the problem's persistence?
- The investigation analyzed over 36,000 auction campaigns in Sydney and Melbourne, confirming Sydney as the epicenter of underquoting in Australia. The practice disproportionately affects house buyers, with an average Sydney home selling for $165,000 above the quoted guide price. The lack of clarity regarding the 10 percent margin rule exacerbates the issue, leaving buyers vulnerable.
- What systemic changes are needed to address underquoting in Sydney, considering the financial incentives for agents and the role of government oversight?
- The current penalties for underquoting in NSW are insufficient deterrents, with fines of only $2200 levied against 137 agents for 284 breaches. This pales in comparison to the substantial commissions agents earn, creating a systemic issue requiring stronger government intervention and improved consumer education to ensure a fair market.
Cognitive Concepts
Framing Bias
The article's framing strongly emphasizes the negative consequences of underquoting for buyers, using emotionally charged language ('misinformation and deception,' 'unchecked free-for-all,' 'waste time, money and dreams'). The headline and introduction immediately establish a critical tone, setting the stage for a strongly biased perspective. The focus on the high percentage of properties selling above the quoted price (48% above 10%, 16% above 20%) and the numerous reader complaints reinforces the narrative of widespread wrongdoing. While the article mentions agents' denials, this is presented as a weak defense against overwhelming evidence of underquoting.
Language Bias
The article employs strong, emotionally charged language that reinforces its negative portrayal of underquoting. Words and phrases such as 'rampant,' 'extraordinary levels of misinformation and deception,' 'rubberly auction listing prices,' and 'unchecked free-for-all' are highly critical and lack neutrality. While the use of such language may be effective in conveying the severity of the issue, it contributes to a biased tone. Neutral alternatives could include 'frequent,' 'significant price discrepancies,' 'auction listing price variations,' and 'unregulated market practices.'
Bias by Omission
The article focuses heavily on the negative impacts of underquoting in Sydney's real estate market, particularly the frustration and financial losses experienced by buyers. However, it omits perspectives from real estate agents who may argue that the 10% margin allows for market fluctuations and that high buyer interest can unexpectedly drive prices above the quoted range. While acknowledging that agents deny deliberate underquoting, the article doesn't delve into specific counterarguments or data that might challenge the narrative of widespread deception. The article also doesn't explore potential benefits of underquoting, such as attracting a wider range of buyers or encouraging competition. This omission creates an unbalanced portrayal of the issue.
False Dichotomy
The article presents a false dichotomy by framing the issue as a straightforward battle between deceptive agents and unsuspecting buyers. It overlooks the complexity of the real estate market, including factors beyond agent control that can influence sale prices (e.g., unexpected shifts in buyer demand, economic conditions). The portrayal simplifies a multifaceted problem into a simplistic narrative of good versus evil, neglecting the nuances of the situation.
Sustainable Development Goals
The article highlights a systemic issue of underquoting in Sydney's real estate market, leading to unfair advantages for sellers and significant financial losses for buyers. This practice exacerbates economic inequality by disproportionately affecting lower-income buyers who are less able to absorb unexpected price increases. The lack of effective regulation and weak enforcement allows the practice to continue, further deepening the inequality gap.