What are the Price Advertising Laws in Real Estate That I Need to Know?
Advertising laws vary state by state. We summarise the property advertising rules you need to know when selling without an agent
It’s important to follow these price guides, as your listing could be flagged and taken off the market until it has been fixed. We certainly wouldn’t want that!
So, what do I need to know in setting my price?
Real Estate Price Range Laws and Pricing Rules by State
VIC, NSW, SA
Properties located in Victoria, New South Wales, and South Australia are strictly required to display their sale price in one of three ways:
- Price range:
- You can elect to select a price range, for example, $500,000 - $550,000
- In selecting a price range, the difference between the top and bottom of the range must not exceed 10%. For example, $500,000 to $550,000 is acceptable. However, $500,000 to $575,000 is not.
- Flat price:
- Your price is displayed as one number. For example, $500,000.
- No price or text in lieu of a dollar amount, by using one of the following:
- EOI – Expressions of Interest
- POA – Price on Application
Another thing to be aware of is that if a potential buyer makes a written offer within your price range but you decide to reject it, you must update your listing to reflect the new price you are willing to accept. For example, if your price range is $549,000 – $569,000 and you reject a written offer for $550,000, then you must update your price range to reflect your decision. So, your property’s new display price would need to be adjusted to $555,000 – $575,000, for example.
Sale prices for properties in Victoria and New South Wales cannot be open-ended. For example, you are unable to use the following to advertise your price. Using a price of $500,000 as an example, the following are not permitted:
- From $500,000
- Offers Above $500,000
- $500,000 plus
- $500,000 +
These are known as qualifying words or symbols and are not allowed.
WA, QLD, TAS
These states have more flexible pricing regulations. Below is a list of the acceptable pricing formats for WA, QLD, and TAS. However, please note this is not an exhaustive list. Using the sale price of $500,000 as an example:
- From $500,000
- Offers Above $500,000
- $500,000 plus
- $500,000 – $550,000 (i.e. a price range – note the same 10% rule applies as in Victoria and NSW, see below)
- $500,000 (i.e. a flat price)
- EOI: Expressions of Interest
- POA: Price on Application
- Auction (if you are selling via Auction in Queensland, your property listing must state Auction).
Note: If you decide to display a price range, it must not exceed 10%. For example, $500,000 to $550,000 is acceptable. However, $500,000 to $575,000 is not.
When selling a property, what does sale by negotiation mean?
As a private seller, you can choose to sell by negotiation when it's difficult to estimate the market price of your property. If a property is being sold by negotiation (also called asking price), the seller sets an asking price or price range, and buyers can choose to offer more or less than that price and negotiate the sale.
Different conditions and restrictions that apply to auctions in each State, however here are the laws which apply Australia-wide:
- Auction sales are unconditional. In other words, you have no right to make the contract subject to any further conditions.
- There is no cooling-off period. This means that if you’re the highest bidder when the hammer goes down, you will be required to go through with the purchase.
- If the vendor makes a bid, this must be announced to other bidders.
- As soon as the bidding level passes the vendor’s reserve price, the property is on the market and will be sold when the hammer falls.
- If bidding doesn’t reach the vendor’s reserve price, the highest bidder has the first right to negotiate with the vendor.
- Contracts are signed and a deposit is paid immediately after the auction is completed.
For state by state information on auction rules and auction laws, see here.
Real estate expressions of interest (EOI) rules
Sale by EOI sees vendors invite buyers to submit an offer to purchase their property, by a specified time and date. Each potential purchaser puts forward their best and final offer in writing.
Generally, a property will be on the market for four to six weeks, to enable the vendor to market the property and ensure ample time is given for buyers to look through the home, finalise their finance and decide on a price. Potential buyers then put in submissions. The vendor reviews the submissions and chooses the EOI that interests them the most.
Other price advertising laws to note
The Australian Competitor and Consumer Commission (ACCC) has set clear rules for real estate agents on providing pricing estimates for property sales. They are not allowed to quote prices that are misleading or deceptive. This includes setting a price range where the seller is not likely to accept an offer at the lower end of the range. Agents must always ensure that the price range marketing does not constitute misleading or deceptive conduct.
Sometimes known as ‘bait pricing’, underquoting is the practice of knowingly advertising the price of a property for sale on the market as lower than the true value of the home in an attempt to drive interest in the property.
We strongly recommend you follow these same pricing rules in advertising your property.
Now that you know how to display your property’s price in accordance with state regulations it’s important to ensure you have set a fair and realistic sale price. Click here to learn how to value your home and set an accurate sale price for your property. This plays a key role in achieving a successful sale!
If you have any questions, please don’t hesitate to contact our Private Property Specialists on 1300 289 697.