Sydney real estate agents facing crackdown on underquoting

Fair Trading has begun a fining blitz on Sydney real estate agents who are deliberately underestimating property prices.

"If there's any indication that the agent has disclosed a price that is less than their estimated selling price, that is underquoting and we will find them," Fair Trading Consumer, Building & Property director Matt Whitton said.

In one instance, a property on Beach Road in Bondi, in Sydney's eastern suburbs, had a price guide set at $2.25 million.

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However, it eventually sold for $3.75 million. The agent has not been accused of underquoting.

Another property at Mount Vernon, near Liverpool, sold for $5 million, almost $1 million above reserve.

However, when Fair Trading inquired into the sale, the agent was found to have done nothing wrong.

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"A few of the local farm owners had recently sold their properties and wanted to stay in the area… there is not a lot of properties available... and we had a perfect competition for an auction," Nick Alexopoulos from One Agency said.

"It's an issue that needs to be addressed and it's one that I think breaks the hearts of people when they do want to enter into the real estate market," Minister for Fair Trading Kevin Anderson said.

Three agents have been fined this year by Fair Trading but in a market as competitive as Sydney's, figuring out what a home will sell for is a difficult.

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"It's not easy when the market is changing almost weekly," Mr Alexopoulos said.

Real estate agents caught underquoting face $22,000 fines and have to hand over the commission and fees from the sale.

"If you think you are going to get away with it, think again," Mr Whitton said.