How has the Statement of Information Changed the Property Industry?
It’s now more important than ever for vendors to ensure their property is realistically priced…
One year on from the introduction of laws requiring real estate agents to prepare a Statement of Information for each residential property they advertise for sale, we take a look at how it has impacted the industry.
On May 1 2017 Victorian laws were strengthened against underquoting and the Statement of Information was introduced, a standardised form which real estate agents are required to complete and make easily accessible to potential purchasers.
Data presented on the form provides consumers with a clear understanding of the value of the property, delivering transparent information including indicative selling price, three comparable properties and the median price for the suburb.
Buyer behaviour has noticeably changed with the increased autonomous access to knowledge. There has been a significant decrease in the volume of curious buyers inquiring about each property by email or phone, but a much more targeted group of buyers attending inspections, whose budgets closely reflect the indicative price. As a result, Marshall White agents have been able to improve the profiling of their database and retarget inspection attendees for future properties of similar value.
The indicative selling price must meet certain requirements which aim to ensure consumers are presented with realistic prices across the industry. The indicative selling price must not be lower than any of the following: the agent’s estimate, any rejected written offer or any asking price advised by the seller.
Marshall White Director and Auctioneer Justin Long says, ‘It’s the best thing that’s happened and while it’s not quite spot on and will need amendments it’s an absolute breath of fresh air for practitioners who embrace it.’
“On May 1 2017 Victorian laws were strengthened against underquoting and the Statement of Information was introduced, a standardised form which real estate agents are required to complete and make easily accessible to potential purchasers.”
The Statement of Information is also impacting buyers’ perceived value of properties. The inclusion of an indicative price range is a huge step towards narrowing advertised prices within a more realistic realm, yet it is still just that – indicative – an agent’s estimate which should not be perceived as a definitive figure.
The mindset that a price range is rigid can cause problems for buyers and vendors alike. If an indicative price is above a buyer’s budget they may not even attend the auction, however since properties do not always reach the indicative price it means buyers may be missing out on properties within their price range. On the opposite end of the spectrum, as a property being auctioned reaches the upper limit of the indicative pricing we are seeing buyer enthusiasm tempering.
It’s now more important than ever for vendors to ensure their property is realistically priced. Approach selling with a receptive mindset for market values and work with your agent to prevent personal ambitions inflating the indicative pricing.
Should you require any further details on the Statement of Information, contact our Marshall White Sales Team for assistance.
For more information contact us on (03) 9822 9999.