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$160,000 underquoting fine for Hocking Stuart Doncaster

$160,000 underquoting fine for Hocking Stuart Doncaster
December 5, 2017 Josh Rowe
underquoting fine hocking stuart doncaster

$160,000 underquoting fine for Hocking Stuart Doncaster

The Federal Court of Australia has handed down a $160,000 penalty to Melbourne real estate agency caught underquoting.

Hocking Stuart Doncaster was found to have engaged in misleading and deceptive conduct and making false and misleading representations about the sale of land under the Australian Consumer Law (ACL).

In relation to some of the properties, Hocking Stuart Doncaster’s representatives informed vendors that underquoting the price range for the property was a technique designed to attract initial buyer interest, and that the higher level of interest would operate to drive up the sale price achieved. The evidence shows that Hocking Stuart Doncaster had no expectation that any of the properties would sell at the represented prices. Indeed, each of them sold for an amount well above the advertised price range.

Hocking Stuart Doncaster will pay $160,000 to the Victorian Consumer Law Fund and $10,000 in costs to Consumer Affairs Victoria, as well as fund and commit to implementing a compliance program aimed at educating its agents about their legal obligations under the ACL.

The judge estimated the small business derived over $34,000 from the contravening conduct.

This program will include the appointment of a compliance officer to ensure that the program is effectively designed, delivered and maintained. The company will be required to submit documents used in the program to Consumer Affairs Victoria, and to act on recommendations made by the Director and his staff.

The worst suburbs for misquoting of property prices in Victoria are:

VICSuburbSold Price vs List Price
Source: November 2017
2Pascoe Vale South16.5%
4Ascot Vale15.1%
10Moonee Ponds14.0%
This survey is for Victorian auctions in November 2017. Only suburbs with 4 or more publicly available quotes and auction results were included. The “Sold Price vs List Price” is the average percentage difference between the sold price and the public agency quote.


Hocking Stuart Doncaster must also issue a notice acknowledging their contraventions in the local newspaper in which they advertise and property websites, and display the notice in their office for six months.

Investigated as part of Consumer Affairs Victoria’s underquoting taskforce, Taskforce Vesta, it was revealed Hocking Stuart Doncaster had marketed and negotiated the sale of nine properties in Melbourne’s eastern suburbs between June 2014 and December 2015, knowing the vendors would not sell for a price within the listed range, or that the property was unlikely to sell for the price listed.

Director of Consumer Affair Victoria Simon Cohen said the Federal Court decision is a timely reminder that underquoting is deceptive conduct that harms buyers and sellers alike, and that it is illegal for estate agents to underquote in Victoria.

“Consumer Affairs Victoria inspectors are continually monitoring compliance with the underquoting laws. Where we find underquoting, we will take action,” Mr Cohen said.

Consumer Affairs Victoria is currently finalising its spring auction monitoring campaign, with inspectors issuing 50 agents with notices to supply documents to ensure compliance with the new laws.

Consumer Affairs Victoria inspectors are conducting follow-up inspections and any serious contraventions of the new laws will be referred to Taskforce Vesta for further investigation.

Read the full judgement Director of Consumer Affairs Victoria v Manningham Property Group Pty Ltd [2017] FCA 1448 (4 December 2017).


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