We have a systemic issue with pricing in Australian real estate, and the lived experience for buyers has become increasingly poor.
Confusion, frustration and mistrust now sit at the centre of what should be one of the most transparent transactions in the economy.
That reality alone tells us one thing clearly: the system is due for meaningful change.
The debate around underquoting in New South Wales and Victoria has reached fever pitch.
Headlines continue to accuse the industry of misleading consumers, while regulators remain trapped in a cycle of trying to change rules that fail to address the real issue.
Now, Victoria has even signalled an intention to legislate the setting of a reserve price up to seven days prior to auction, a move that may sound protective on the surface, but in practice risks doing the exact opposite.
But what if the real answer has been sitting quietly to the north all along?
Queensland has long operated under an auction framework that strips away the pretence of trying to predict where the market will land.
Rather than playing god on price, the Queensland process embraces what markets are designed to do best: allow genuine competition to determine value.
I was fortunate enough in university to read The Wealth of Nations by Adam Smith.
It introduced the principle of the Invisible Hand – the idea that free, transparent markets naturally arrive at fair value without micromanagement.
Real estate auctions are one of the purest modern expressions of that principle.
In property, the only person who is ever truly “right” on price is the buyer on auction day.
No agent, no valuer and no algorithm can perfectly predict where sentiment, confidence, urgency and competition will land weeks in advance.
By allowing auctions to function as open forums of demand and supply, Queensland honours that principle.
Buyers and sellers meet transparently. Energy, competition and real budgets, not speculation or selective quoting, determine the outcome.
That is the Invisible Hand in motion.
The legislative regimes in these southern states have unintentionally entrenched a system where agents are compelled to play a dangerous game.
Instead of fostering clarity, price guides and ranges have become the epicentre of mistrust.
Agents now operate under constant threat of underquoting accusations – sometimes deserved, often not, but always damaging.
Let me be clear: this is not a defence of bad actors. Those who deliberately mislead buyers and sellers should face the full force of the law.
But ultimately, bad systems create the conditions in which bad behaviour thrives.
When an agent is forced to announce price guides or reserves weeks before auction day, they are no longer a facilitator of competition – they become a forecaster of the unknowable.
This is where the dangerous gap opens between consumer expectation and market reality.
There is a deeper truth policymakers continue to ignore or perhaps don’t understand: price guides are a relic of a pre-digital era.
They were created for a time when buyers had limited access to real time sales evidence and relied almost entirely on agents for price education.
Today, that world no longer exists. Buyers can see sold results instantly on platforms like Domain.com, realestate.com.au, and other industry portals, tracking clearance rates, suburb medians, comparable sales and market momentum in real time.
Yet even then, comparable sales only measure what sold, not why it sold.
They do not capture a seller’s motivation, urgency, financial situation or risk appetite.
They do not reflect the quality of the agent, the standard of negotiation, or the power of the marketing campaign used to manufacture competition.
Two identical homes can sell for vastly different prices based purely on execution.
To pretend that backward looking data can accurately forecast forward looking human behaviour is to misunderstand how property markets actually function.
The latest proposals in Victoria to force sellers to declare a reserve price up to a week before auction are a perfect example of a policy that sounds rational but misunderstands how markets actually behave.
Reserves are not theoretical figures – they are dynamic, emotional, strategic decisions influenced by:
- Buyer demand in the final days
- Pre-auction offers
- Feedback from inspections
- The competitive depth of the bidder pool
Locking a seller into a reserve seven days out does not improve transparency – it freezes the market in time and removes the seller’s ability to respond to real world demand as it materialises.
This doesn’t protect buyers. It distorts the very competition that delivers true price discovery.
There is a deeper issue embedded in this policy direction.
You cannot regulate trust into existence by stripping rights away.
Telling a seller how they must sell their own asset – when to set their reserve, how to disclose it, and how flexible they’re allowed to be crosses from consumer protection into property rights erosion.
Will our system be better only by eroding the rights of property owners? History shows otherwise.
Removing decision making power from owners does not create better outcomes.
It simply replaces market logic with government guesswork.
This debate is also being exacerbated by a structural reality that few are willing to acknowledge:
State governments are already struggling to:
- Properly resource compliance teams
- Enforce existing underquoting laws
- Conduct timely investigations
- Educate consumers at scale
In other words, they already lack the operational capacity and technical depth to safeguard buyers effectively under the current system. Are they the solution or part of the problem?
The question must be asked:
Why create more complex rules, more reporting obligations and heavier enforcement burdens when the regulatory machine is already straining under the weight of what it has?
More laws do not deliver better outcomes when enforcement capacity and technical expertise are the real bottlenecks.
The reality is that a single investigation can take months, not weeks to progress through the system.
By the time any enforceable action occurs, the transaction is long settled, the parties have moved on, and those who were meant to be protected are left without meaningful recourse.
The damage is already done, and the delay leaves buyers, sellers and agents stuck in limbo with no resolution.
Queensland’s framework demonstrates a simple but powerful truth:
the strongest safeguard against misinformation is not more regulation around price guides – it is removing them from centre stage altogether.
By elevating open, public competition over speculative price signalling, Queensland removes the very oxygen that underquoting disputes rely upon.
Instead of arguing over whether a guide was “accurate,” buyers witness in real time exactly where the market lands.
Sellers benefit from maximum competitive tension. Buyers walk away knowing they paid what the market and, not what an agent determined.
Trust is built not through disclaimers, but through transparency.
If NSW and Victoria adopted Queensland’s approach, they could:
- Restore buyer trust by removing misleading or arbitrary price signals
- Create a cleaner playing field where agents facilitate, not forecast
- Strengthen competition by allowing auction floors to reflect true market forces
- Reduce regulatory burden, not increase it
- Protect sellers’ rights, not dilute them
Real estate should not be about agents pretending to know the unknowable.
It should be about creating the right conditions for the markets “Invisible Hand” to work: open, fair and transparent competition. Queensland has already shown the way.
It’s time for NSW and Victoria to stop legislating against symptoms and start embracing a model that eliminates the problem at its root
