Please sign petition for allowing a price guide on houses for sale

W

wylie

I thought I would put up this petition for those who wish to sign.

I don't bother even looking at houses without a price guide, or some indication or a range and now the government is trying to ban it. How is someone meant to know what the vendor wants for a house if there is no price guide (regardless of what it is actually worth)?

And I know people say buys should know their market, but I find that difficult, especially in a market that is moving quickly, or in the case of an unrealistic vendor. A house might be "worth" $900K with a vendor who thinks it is worth $1M, so price guiding it keeps out some of the tyre kickers.

http://www.change.org/en-AU/petitio...-guides-on-properties-going-to-auction-in-qld
 
There should be an overhaul of Real Estate laws in Australia but banning price guides hardly seems like the answer.

Forcing price guides to be an accurate guide of the vendor's reserve is something I could live with though.

Additionally I would prefer if properties could only be advertised for sale if a valid contract of sale has been prepared but that is just me getting sick of agents who never have the contracts available until 1-2 weeks prior to the auction.
 
Wylie, I'm sorry to say, but I think this really is a done deal.
Don't ask me why. I'm sure many sales agents have many ways of justifying it.
The only thing I can suggest is that if you sort by price and the property turns up in your results and looks good, do a quick check of Onthehouse.com.au as a first port of call to get an indication of price.

Cheers

Jen
 
JenJen said:
Wylie, I'm sorry to say, but I think this really is a done deal.
Don't ask me why. I'm sure many sales agents have many ways of justifying it.
The only thing I can suggest is that if you sort by price and the property turns up in your results and looks good, do a quick check of Onthehouse.com.au as a first port of call to get an indication of price.

Cheers

Jen
Click to expand...

I don't think onthehouse is much help really. Even the RPdata report on our own house puts it at between $860K to $1.05M.

Onthehouse puts it at $760K to $865K.

House in our street estimate by onthehouse is $680K to $770K and it just sold for $870K. This is 3/1/2 and ours is 4/2.5/2 with a pool. So, these sites are no help really.

What bothers me is that we just sold a house and were taking it to auction with a guide price of $990K+.

We still had lowball cheeky "would they take" or "I'd buy it for $900K" verbal and another for $930K which we didn't bother even getting on paper. Our agent told them "you'd be lining up with plenty of other people at that price".

Friends are auctioning their house without a guide price and they are expecting over $1M. They are having people inspecting thinking it is in the $800K to $900K range. If the agent put a guide price of $990+ those people looking in the $800K to $900K range would not waste any time on building/pest inspections or get their hopes up and maybe miss out on a property they "can" afford rather than believe they will get "this one" for a price that the vendor would not even consider.

Had our auction had no price guide, we would have been getting $800K buyers hoping to snag a bargain. We still got a few cheeky ones, but didn't waste our time, our agent's time or go to auction with a pile of people thinking they were going to buy it for $900K.

I just think it is an option we should be able to choose, and I would choose it again, it I could.

My understanding of the new rules is that the agent will not even be able to answer the basic question of "will this sell for less than $1M?". How is that helpful? I think it is a big step backwards. I reckon it will stop many people from auctioning (which is not huge in Brisbane anyway really).
 
I agree that an Onthehouse price estimate alone isn't helpful. It's just one source which can be off the mark. However you can obtain sales data from these kind of sites. I use Onthehouse to download and export raw sales data into Excel, then clean, sort, graph and analyse it to get an idea of price range. It's a complicated and time consuming process though...

So good news that they might be reconsidering it!

Cheers

Jen
 
From my understanding the legislation has not yet passed due to the public uproar from many consumers and industry bodies, including REBAA. Our recent press release makes it pretty clear that we believe removing price guides is a step in the wrong direction
http://rebaa.com.au/media-release/buyers-losers-proposed-ban-auction-price-guides/

and this
http://www.propertyobserver.com.au/...er-queensland-auction-price-guide-debate.html

On a personal note, I believe it only serves to further damage the already tainted real estate industry, in removing yet another layer of trust and transparency. For buyers new to an area or even those who haven't bought for some time where on earth are they supposed to start when nothing has a price tag? Not only are the proposed changes unwarranted but they seem to serve no useful purpose.
 
Reading Terry Ryders article is interesting. It does put price guides into a different perspective. I b3elieve there will always be a divide. At the end of the day, the seller wants the most they can get, and where possible, the buyer wants to pay the least that they feel they have to. So when you think of it, getting advice from the sellers agent does not seem the be the wisest thing to do. I think most buyers do research, some more than others, and to get feedback from them is more valuable when they have do been influenced by what a seller may be hoping for. I don't think that there will be the perfect situation. I do however believe that intervention by governments rarely fixes anything.
 
Chris B said:
There should be an overhaul of Real Estate laws in Australia but banning price guides hardly seems like the answer.

Forcing price guides to be an accurate guide of the vendor's reserve is something I could live with though.

Additionally I would prefer if properties could only be advertised for sale if a valid contract of sale has been prepared but that is just me getting sick of agents who never have the contracts available until 1-2 weeks prior to the auction.
Click to expand...


I too would like to see a valid contract of sale (in Vic a section 32 as well), as a prerequisite to the property being advertised for sale.
Some REAs offer a 'draft' version. Also there is a part where the seller needs to sign and date that the info they provided is true and often that is not completed either when presented to buyers.
 
If I see both sides of the debate crying foul, it does look like something must be getting towards being balanced....

I'm in two minds on this. Price guides are good when correct but there is no easy way to show when they are fraudulent. Look at auctions in Vic. General practice over the last decade is now for punters is to add 10-20% 'price guide' I appreciate what REIQ have been saying on this.

The "trust me" agreement from some other REA associations doesn't cut it.

We don't have buying guides in Qld. We haven't had too many complaints other than buyers forced to do more research into values. I don't see this as a bad thing either. Shouldn't you have a bank val and all your finance sorted before auctions anyway? I actually see this as a positive for buyers agents who can show their value by cutting through can getting the punter value aligned to their requirements and vendors pre-qualified and committed buyers to close deals with. Buyers who are purchasing property once, maybe twice in a decade. Emotional buyers

I noticed the loudest complaints are coming from REINSW and McGrath. Maybe they don't want to see this process in their territory. Better stop in the north before it heads south.

If price guides are given, the reserve should be set at the low end of the quote.
ie. $850k - $950k. The reserve can't be higher than $850k. Then everyone knows if the price guide is reached in an auction, the property is on market. If it doesn't, the vendor is still available to accept or reject. An easy way of making sure price guides aren't too low and wasting the time of buyers who's budget isn't near the seller's price.

I did like the comment from CEO of REIQ, Anton Kardash in the article mentioned previously.
"if sellers want to market their property with a price or price guide, then they should use a private treaty method instead."

So what the underlying issue is, is getting auctions being the norm. Not for the benefit of seller or buyer but the agent. In a hot market or down market the balance changes between the seller & buyer. But auctions create a way to force urgency and timelines unequally on both regardless of the market. The way RE Agencies are run now days isn't about the level of commission they may get with a larger price (margin). It is about how many commissions or listings I can convert to deals in the shortest time frame (cashflow). It also negates the seller over market expectation being an issue to confront until actual auction day. The agent doesn't have to try and condition them until it is too late for them.

When I only have one lever to pull (price) and the difference in the margin of the deal is very small but the pressure to close to get the cashflow in is huge, guess what preferred marketing strategy is.

I wouldn't sign the petition unless included that the lowest value set in the price guide was the reserve price. I can guarantee that isn't going to happen soon.

My $0.02 worth.
Don't start me on vendor bidding......
 
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For auctions, reserve should be published at start of campaign

Yes, vendors may want to change their mind (the age old argument against this) and they should be permitted to, but if they do so within a week of the auction, the auction is delayed a week. If there is more interest than they expected, that should mean a property goes for well over reserve anyway, so I'm not sure why they need to revise the reserve upwards.

I really don't understand why this can't be implemented. It is only fair given the costs potential buyers incur. Also, property sales data is increasingly difficult to find for free or without ringing agents, so telling buyers to do their research is increasingly assinine.
 
marks said:
If price guides are given, the reserve should be set at the low end of the quote. ie. $850k - $950k. The reserve can't be higher than $850k. Then everyone knows if the price guide is reached in an auction, the property is on market. If it doesn't, the vendor is still available to accept or reject. An easy way of making sure price guides aren't too low and wasting the time of buyers who's budget isn't near the seller's price.

I did like the comment from CEO of REIQ, Anton Kardash in the article mentioned previously. "if sellers want to market their property with a price or price guide, then they should use a private treaty method instead."
Click to expand...

With a recent sale, we chose auction for various reasons, one of which to get a bulldog barrister off our back and have an "end date". We chose to ask for "offers over $990K" a figure that was close to our reserve. In fact, it would have been our reserve unless there was a rush of people wanting to pay us even more :D.

Ultimately we accepted a cash offer before the auction, but the guide price was good because it stopped those thinking they would be getting the house for somewhere in the $800Ks. As much as people here say "know your values" and "do your research", I think it is difficult around the $1M mark to know just what house IS worth. We had people think they might get it for mid $800K.

Of course, our guide price didn't stop the smart folks from verbally offering $900K, but we didn't bother even answering those. However, it was a lowball buyer who "tried it on" at $50K less than he ended up contracting for. We ignored his first offer completely, didn't even bother getting it on paper, didn't bother even responding.

Friends sold their house this weekend at auction. They were hoping for over $1M but sold for $950K. They had people thinking it was worth $850K.

What makes it hard to "know" what a house is worth is the likes of a house in our street, right next door to a house that sold a year ago (different market but not worlds apart). Four bedroom, two bathroom, big deck, extra "storage" rooms underneath, sold for $710K. House right next door to the $710K one sold recently, three bed, one bath, not a big house, but plenty of charm $870K. None of the folk in our street can believe they reached that level. It sold at the first open to a couple who were (I'm told) desperate to get into this street, and we all believe it sold for over the odds due to that. Nobody thinks it is worth $870K.

The house we sold, similarly good street, four bed, three bath, big block, lovely house went for just $110K more.

There doesn't seem to be any rhyme nor reason behind what sells for what figure these days, so pinpointing what something will sell for is not as easy as "doing your DD".

I'm all for the way we sold with "offers over $900+" or whatever figure is the lowest that would be accepted either via auction or private treaty, and let the market find the level. And I've seen that not putting ANY guide on has meant really insulting lowball offers, which are better avoided. It just stops those who think the value is $100K less than it really is from wasting everyone's time.
 
wylie said:
House right next door to the $710K one sold recently, three bed, one bath, not a big house, but plenty of charm $870K. None of the folk in our street can believe they reached that level. It sold at the first open to a couple who were (I'm told) desperate to get into this street, and we all believe it sold for over the odds due to that. Nobody thinks it is worth $870K.
Click to expand...

But this is where the entire argument falls down in a heap.

It doesn't matter what you or the entire street believes. This isn't some consensus by democracy where you all vote and come up with a median. The deal and market are only set at the extreme edges. You already know this as an experienced investor, so I'm confused as to why you would write something like that.

The "market", as you know, is defined by what the individual Seller can agree with an individual Buyer regarding that unique individual title deed. What the people in the street "believe" doesn't rate a mention.

The motivations in every individual deal will be different. Trying to legislate to herd people into some pre-determined confine isn't going to work, especially as this relates to public auctions only.

Death / divorce / illness / neighbours wanting to buy and that property is the only one in the world next to theirs / windfall inheritances that haven't been earnt / being close to family / inexperienced Buyers and/or Sellers all can heavily distort what the "expected norm" should be.

Remember, in most cases, only the very highest of Buyers gets to 'go to market'.....everyone else goes home with nothing and don't form any part of 'the market', even though they are 99.9% of the Buyers.

I guess that is where the opportunity in the property market lies.
 
Please no! My last purchase was a private sale/unadvertised price. He who enquires wins. Imperfect markets are the canny buyer's best friends.
 
Dazz said:
But this is where the entire argument falls down in a heap.

It doesn't matter what you or the entire street believes. This isn't some consensus by democracy where you all vote and come up with a median. The deal and market are only set at the extreme edges. You already know this as an experienced investor, so I'm confused as to why you would write something like that.

The "market", as you know, is defined by what the individual Seller can agree with an individual Buyer regarding that unique individual title deed. What the people in the street "believe" doesn't rate a mention.

The motivations in every individual deal will be different. Trying to legislate to herd people into some pre-determined confine isn't going to work, especially as this relates to public auctions only.

Death / divorce / illness / neighbours wanting to buy and that property is the only one in the world next to theirs / windfall inheritances that haven't been earnt / being close to family / inexperienced Buyers and/or Sellers all can heavily distort what the "expected norm" should be.

Remember, in most cases, only the very highest of Buyers gets to 'go to market'.....everyone else goes home with nothing and don't form any part of 'the market', even though they are 99.9% of the Buyers.

I guess that is where the opportunity in the property market lies.
Click to expand...

I think you missed my point entirely. Putting a price guide helps even those who have a fair idea of what a house "should" be worth. A seller wants $1M so price guide it $990+ and stop all the $800K buyers from sniffing about.

It also makes a difficult for those who come to the forum asking "how much is this house worth" and many people answer "if you have done your due diligence, you would know how much it is worth".

I'm merely point out that even those who "know" how much a house "should" be worth in comparison to other houses of similar character, size amenity etc, even down to the same street get it very, very wrong. Or... someone simply falls in love with a house and pays over the odds.

I don't think it makes my argument "fall down in a heap" at all.
 
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wylie said:
I think you missed my point entirely. Putting a price guide helps even those who have a fair idea of what a house "should" be worth. A seller wants $1M so price guide it $900+ and stop all the $800K buyers from sniffing about.
Click to expand...

But it was REA who advertise $800k+ buyers to get the numbers at auction up. People getting B&P and vals who are wasting time & resources. And as we have seen in other states, this is hard to police and never enforced.

Even your statement of the vendor wanting $1M+ but advertises $900K+ isn't the best example. Why not advertise $1M+ or is the vendor happy with a reserve of $900k.
No vendor is going to gamble $100k difference in case they get competition for over $1M+ with that reserve. (Starts with greed, then overwhelmed by fear)
And buyers with 900 to 950 budgets are going to wasting there time trying to get a sale.
Then the agent steps in to either condition the seller down & buyer up with a whole heap of reasons.... And he needs to get the deal closed at any price to get the cashflow in.


Just to note the REBAA press release noted before. The facts need to be mentioned.
The government isn't removing price guides or banning a something in use today. Qld doesn't produce price guides for auctions today. The law around RE transactions is being updated and the restriction in price guides is as before. Interesting that none of the other real changes are being debated by the industry.
 
marks said:
But it was REA who advertise $800k+ buyers to get the numbers at auction up. People getting B&P and vals who are wasting time & resources. And as we have seen in other states, this is hard to police and never enforced.

I've not experienced an agent advertising $800+ when the vendor wants $900. As a vendor I would not allow it.

Even your statement of the vendor wanting $1M+ but advertises $900K+ isn't the best example. Why not advertise $1M+ or is the vendor happy with a reserve of $900k.

Sorry, my typo. We wanted over $1M and listed "offers $990+". That was a typing error. I've changed my typo and now it reads as I meant it to read. I'd never suggest offers over $900K if I wanted $1M.

No vendor is going to gamble $100k difference in case they get competition for over $1M+ with that reserve. (Starts with greed, then overwhelmed by fear)
And buyers with 900 to 950 budgets are going to wasting there time trying to get a sale.
Then the agent steps in to either condition the seller down & buyer up with a whole heap of reasons.... And he needs to get the deal closed at any price to get the cashflow in.


Just to note the REBAA press release noted before. The facts need to be mentioned.
The government isn't removing price guides or banning a something in use today. Qld doesn't produce price guides for auctions today. The law around RE transactions is being updated and the restriction in price guides is as before. Interesting that none of the other real changes are being debated by the industry.
Click to expand...

As I said earlier (but mistakenly put $900K instead of $990K on that last post that you are now quoting), we were very open and honest in our price quoting.
 
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