‘Thanks for raiding us’: Inside the crackdown on underquoting

November 1, 2026 — 5:00am

They might not have sirens or carry guns, but when inspectors from the property taskforce come knocking on the doors of real estate agencies, they can be just as intimidating as police.

“Thank you for raiding us” is how the head of one Sydney real estate firm sarcastically parted ways with the Strata and Property Taskforce and its commissioner, Angus Abadee, after they conducted an Anytime Anywhere compliance check this week, observed by The Sydney Morning Herald as well as New South Wales Fair Trading Minister Anoulack Chanthivong.

The taskforce was established by the Minns government early last year, with a key objective to lead NSW Fair Trading’s crackdown on underquoting that had become pervasive in Sydney’s cut-throat real estate industry.

While some activities are conducted in plain clothes, such as observing auctions and open home inspections, on Wednesday, the team wore a co-ordinated uniform, not dissimilar to a police squad, as they entered agencies.

They begin by flashing their badges, identifying themselves, and requesting a range of different documents, financial statements and data, before promptly setting up their laptops and sifting through the information to check for anything suspicious.

Barring the rare confrontational visit, most agents were welcoming to inspectors, albeit with a sense of nervousness and slow fumbling for documents, said Marie, who had worked across the commercial and residential real estate sectors for 27 years before joining the state’s compliance unit.

“Most people want it to be an even playing field, so the majority are supportive and compliant,” she said. “What causes a stir is those who don’t comply or find a loophole and make it difficult to compete.”

When it comes to underquoting, the team chooses two properties that an agency currently has on the market, and asks to see how the agent arrived at its price guide, which includes recent sales of comparable homes. Inspectors check that those properties are indeed comparable.

‘Everyone should have confidence that everybody is playing by the rules.’

Anoulack Chanthivong, Fair Trading Minister

The team also includes Sofiia, a forensic accountant with a background in finance and anti-money laundering who checks books to make sure an agency’s trust account funds are never misused. She’s joined by inspectors Dean and Margaret.

It’s an idyllic day outside, with the sun shining through the vast street-level windows of the Pyrmont waterfront office of the first agency the team audits. But inside, the licensee is copping a grilling.

While she is co-operative and has answers to all their questions, the inspectors drill down into how a $1.1 million auction guide was arrived at for a two-bedroom, two-bathroom inner-city unit. The contract for sale reveals the vendor is hopeful of it selling for $1.21 million.

Crucially, they also ask to see emails and communications sent to interested parties who inquire about the price guide. Texts, WhatsApp and WeChat messages come under their scrutiny, too.

Unlike in Victoria, vendors are not required to include a price guide on property listings in NSW. While that is set to change from mid-November as part of sweeping reforms to boost pricing transparency, for now, it means that much of the information required to prove underquoting is contained in private messages between agents and potential buyers.

Other rules coming into effect from next month include significantly ramping up the penalty for agents caught underquoting, from $22,000 to $110,000 or three times the agent’s commission, whichever is greater. The penalty for dummy bidding at auctions will also double to $110,000.

Agents will also be prohibited from advertising a selling price that is lower than a previously rejected written offer or the highest unsuccessful bid at an auction. And from February, they’ll be made to publish a statement of information to be more transparent with how guides are calculated.

The new laws come at a time of immense change for the industry, with the current market downturn upending years of rampant demand that created a power dynamic heavily in agents’ favour.

Sydney’s median house price dropped 5.8 per cent over this year, and 4.7 per cent alone in the three months to September. Median unit prices fell 3 per cent in the same three months. Auction clearance rates paint a picture of a buyer’s market.

‘There’s been a presumption that all agents are doing the wrong thing, which they’re not. Most people are doing the right thing ... so this is about levelling the behavioural playing field.’

Angus Abadee, Strata and Property Taskforce Commissioner

Since prices began falling after February, plenty of agents have left the industry, while others who have relied on commissions to fund their lifestyles vent about picky buyers or discuss ways to generate heat in an otherwise cool market.

While the Morton real estate agency in Pyrmont passed all compliance checks, its co-founder, Ewan Morton, seized on Abadee and Chanthivong’s presence to have a pointed but friendly discussion about some of the “unintended consequences” of the upcoming reforms that have agents worried.

“A lot of agents, they feel that they’re getting hammered,” Morton told the pair. “When someone owns a property, fundamentally, they’ve got a right to ask what they want for it ... [and] a buyer is intelligent enough to look at that and make their own decision as to whether they wish to pay more. This is where the whole underquoting thing gets tricky,” he said.

Not missing a beat, Chanthivong politely hit back, saying the new laws will not only make pricing clearer for buyers and stop them wasting their time and money on inspections for properties they can’t afford, but should in theory benefit agencies, too.

“You don’t want to have to spend your staff’s time or your time with a potential buyer or investor who’s never in the market in the first place [when they learn what the vendor actually wants],” Chanthivong said.

A key concern, too, is the prohibition from advertising a price lower than a previously rejected offer. In a cooling market, Morton said overly hopeful vendors were hastily rejecting offers, but in time coming to regret those decisions. Under the new laws, they won’t be able to lower their list price if the market cools further.

Abadee responds to the concerns, but in a break before visiting the next agency, he stresses to The Herald the importance of a restoring an even balance between consumers and real estate agents, which he concedes suffers from a serious trust deficit.

“Agents are experiencing a tighter market ... we recognise the toll that takes,” said Abadee, who wears a tailored brown suit, sleek tie and blue socks with an ibis bin chicken pattern. “But the purpose of the reforms is not to regulate a hot market or a cool market, it’s about behaviours we expect of a professional agent.

“Even if we are seeing fewer instances of underquoting at the moment because of the cooler market, we need to make sure that when it does rebound, the expected standard of conduct is the same.”

Underquoting could be difficult to prove, and even agents could be unclear, Abadee said. The laws aren’t about penalising them for being good at their job and creating interest in a property that sees its sale price exceed expectations. Rather, they are about explicitly weeding out misleading conduct and in doing so, giving confidence to law-abiding agents that they don’t have to compete with bad-faith counterparts.

“There’s been a presumption that all agents are doing the wrong thing, which they’re not. Most people are doing the right thing ... so this is about levelling the behavioural playing field,” Abadee said.

But the team has caught plenty of bad eggs. In the past 12 months, they’ve attended 116 auctions and conducted 469 Anytime Anywhere underquoting compliance checks, issuing more than 70 fines worth almost $160,000.

Plain clothed inspectors attended almost 80 homes during a blitz in September, which led to 10 fines as well as warning and educational directives. The department maintains an online register to name and shame agents caught underquoting.

The new rules are clearly set to disrupt the way many agents have been operating. For this reason, many see Abadee’s presence at the drop-in inspections as a chance to get clarity about what they can and can’t do from next year.

At the next compliance check at an agency in Leichhardt, the director makes the most of the opportunity. First, he wants to clarify what constitutes an offer in the eyes of the law, and if a vendor rejecting a higher price but with a delayed settlement or other “strings attached” means they’ll have to update their guide to that rejected price under the changes.

Next, he asks about the existing laws for mandatory disclosure when listing a property of any homicides that occurred within the past five years. Do agents also need to disclose suicides? Abadee’s answer is that while suicide is not explicitly stated in the disclosure law, it’s context specific and that anything that might deter someone from buying should be mentioned.

While it relates to an existing law, the message urging agents to err on the side of transparency speaks to the intent behind the new reforms.

Ultimately, it was about putting dodgy agents on alert, said Chanthivong, who stressed that NSW agents would now face the steepest penalties for underquoting in the country. However, he conceded the transparency measures didn’t go as far as in Victoria, where a reserve price must be revealed a week before an auction.

“I think our approach is the better approach. We want to change behaviour right before people actually start investigating a property, not towards the tail end,” he said.

“Everyone should have confidence that everybody is playing by the rules.”

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