Victoria is about to take a significant step towards greater price transparency in the property market, with new rules requiring sellers to publish their auction reserve price at least seven days before auction day.
The changes, which commenced October 1, are designed to give buyers more certainty and tackle one of the industry’s most persistent criticisms: underquoting.
But they also raise an interesting question for Queensland.
Should we follow suit?
There’s no doubt that buyers want greater transparency. Knowing more about where a property sits in the market can help buyers make informed decisions, avoid wasting time on properties outside their budget and feel more confident about participating in an auction.
Victoria’s new rules go further than simply publishing a price guide. Agents will need to disclose the seller’s reserve price seven days before the auction, update marketing to reflect that figure, provide greater detail around comparable properties and publish the eventual sale price.
On the surface, greater transparency sounds like a win for everyone.
But the reality is a little more nuanced.
Is the reserve price really the right measure?
A reserve price is ultimately a seller’s decision and it can change as circumstances change.
It may be influenced by market conditions, buyer interest, competing properties, campaign activity and the seller’s individual circumstances.
Publishing that figure a week before an auction could provide certainty for buyers, but it may also create a perception that the reserve represents the true market value of the property.
It doesn’t necessarily.
The market value of a property is determined by what buyers are genuinely prepared to pay and that is often only discovered when buyers compete.
An auction is designed to create that competition.
The case for greater transparency
There is a strong argument that buyers deserve better information.
If a property is being marketed at a price significantly below where the seller expects it to sell, buyers can understandably feel frustrated when they arrive at auction only to discover the property is going substantially higher.
Greater transparency could help remove some of that frustration.
It could also encourage agents and sellers to be more considered about pricing from the beginning of a campaign, rather than relying on a deliberately low price point to generate attention.
For buyers, that could mean fewer surprises and a clearer understanding of which properties are genuinely within reach.
But could Queensland’s market be different?
This is where the Queensland conversation becomes particularly interesting.
Queensland’s property market is not Victoria’s property market.
Different conditions, different buyer behaviours and different levels of competition mean that what works in one state may not necessarily translate perfectly to another.
Queensland has also experienced strong demand across many parts of the market, particularly in South East Queensland. In a competitive environment, the eventual selling price can be difficult to predict with absolute certainty before a campaign has run its course.
And that is precisely why how a property is positioned matters.
Rather than simply attaching a number to a property, a good campaign should give buyers the information they need to understand the property, its position and its value within the market.
Comparable sales. Buyer feedback. Competition. Presentation. Marketing exposure. Timing.
All of these factors contribute to the eventual result.
Could greater transparency actually benefit sellers?
Perhaps.
A more transparent market may ultimately encourage sellers to focus less on an advertised price and more on the overall strategy behind their campaign.
Because achieving the best result isn’t necessarily about choosing the highest price guide.
It’s about understanding the market, identifying the right buyers, creating competition and ensuring the property is positioned to attract the strongest possible level of interest.
That is where experienced advice becomes particularly important.
A price is only one part of the equation.
Positioning is what can make the difference.
So, should Queensland follow Victoria?
There are certainly elements of Victoria’s reforms worth considering.
Greater transparency can build confidence, improve the buyer experience and help create a more accountable property market.
But whether Queensland should adopt the same rules, particularly mandatory disclosure of the reserve price before auction, is less straightforward.
Perhaps the better question is not simply “Should Queensland publish reserve prices?”
Perhaps it is:
“How can we give buyers greater confidence and transparency, without taking away the competitive nature of the auction process?”
Because ultimately, sellers deserve the opportunity to achieve the strongest possible result, while buyers deserve to know they are making informed decisions.
Getting that balance right will be the key.
And regardless of whether Queensland follows Victoria’s lead, one thing isn’t likely to change:
Selling is easy. Maximising isn’t.
Byrony O’Neill
0412 132 480
*information and data for article sourced from realestate.com.au