Whilst I agree with a number of people's posts about REA's, surely your own due diligence is carried out regarding the market value.
The only people that should be really upset with misleading price guides are the uneducated who genuinely believe they are a chance at 25% under market value.
Regardless of this point, it is a contravention of the Australian Consumer Law to deliberately underquote a property through its price guide. Yes, consumers can see through this by doing market research, but the obligation is initially on the estate agents, not on consumers.
You can't justify misleading and deceptive conduct on the basis that the consumer should have known it was misleading by doing research. The law doesn't work like that, it's there to protect consumers from potentially being misled in the first place (within reason), not benefit estate agents.
In my experience, it's quite easy to tell when deliberate underquoting has occurred when you go to auction and the "on the market" bid (not the sale price) is significantly over the top range of the price guide. In my opinion, the top end should be the reserve, or very close to it. If there is significant interest in a property, a good agency will update the price guide during the campaign.
I recently attended an open for a property quoted $580K - $620K at the start of the campaign and ended up at $620K - $680K before auction day. The first price guide was criminally underquoted, but designed to drag people to the open thinking it was a bargain of some sort. This kind of conduct should not happen.
