Update: New CAV Guidance on Selecting Comparable Sales
Consumer Affairs Victoria (CAV) has revised its guidelines on how sales agents should choose comparable properties for estimating a selling price. These updates are designed to enhance compliance and increase accuracy within the industry.
Under Victoria’s underquoting laws, agents are required to identify three recently sold comparable properties in the same area to support the price estimate in the Statement of Information. CAV’s Underquoting Taskforce has discovered that some agents have been selecting less similar, lower-priced properties, which could mislead buyers. The updated guidelines clarify the factors that need to be considered when selecting comparable sales.
Key Factors to Consider
Agents are required to evaluate a property’s standard, condition, location, and sale date. The revised guidelines incorporate the following additional factors:
- Whether properties are renovated or not, unrenovated or upgraded,
- Build status (fully built home versus vacant land)
- If properties with identical or very similar features have recently been sold within the same estate or apartment complex.
- Differences in school zones, access to shops, and other local amenities
These updates help agents select the most accurate and relevant sales data, ensuring buyers have realistic expectations about a property’s likely selling price.
Review the updated guidelines here.
Apex HR Comment
The updated guidance reinforces what Apex HR has consistently conveyed through our compliance training and recommended program activities. Our continuous emphasis on precise price representation, clear communication, and defensible Statements of Information directly supports these updates.
It’s important to note that these updates precede the legislative changes that will take effect on 25 November 2025, introducing higher penalties for underquoting offences.
Agents should use this opportunity to review internal procedures and confirm that their sales teams adhere to compliant and well-documented practices.
Compliance and Penalties
CAV can request supporting documentation from agents to evaluate the reasonableness of chosen comparables. Non-compliance may lead to penalties such as fines over $40,000 and possible loss of commission under Victoria’s estate agent laws, as well as fines up to $50 million for companies and $2.5 million for individuals under Australian Consumer Law, according to Taskforce Findings.
Since its inception, the Underquoting Taskforce has handled over 5,000 complaints, of which more than a quarter involve allegations of unreasonable comparable sales.
Interestingly, more than a third of complaints originated from within the industry, indicating that many agents are dedicated to improving standards and encouraging fair practices.
In Summary
The message is clear: when determining price estimates, select comparables that genuinely match. CAV’s revised guidance and the upcoming penalty hikes emphasise the need for strong compliance leadership in every sales office. This is a chance for all agents not only to meet the standards but also to set the example.