MEDIA RELEASE
The Real Estate Institute of Victoria (REIV) welcomes today’s announcement by the Victorian Government that – if re-elected – it will seek to legislate the inclusion of building and pest inspection reports in Vendor’s (Section 32) Statements but urges it to take further steps to improve the residential property transaction process.
This was a key recommendation made by the REIV in its A Blueprint for Marketing of Residential Real Estate in Victoria submission to the Government, released in January this year, and recognises that costs and resources associated with such inspections are an unnecessary financial burden for buyers.
Developed by the REIV-convened and senior real estate industry member-comprised Strategic Working Group (SWG), the blueprint proposes a more nuanced and holistic approach for Government to adopt in improving price transparency and consumer confidence in residential property transactions. This comes in response to the well-publicised issue of underquoting in Victoria.
Headlining the blueprint’s eight recommendations is a requirement for vendors to confirm their reserve price falls within a ten per cent advertised price range no later than three clear business days before auction.
Toby Balazs, REIV CEO, said that, while the organisation is pleased with today’s announcement, it reminds the Government not to view this change in isolation, but rather as only one part of the blueprint’s broader policy approach.
“The Government’s willingness to accept our important recommendation regarding the inclusion of building and pest inspection reports in Vendor’s Statements, and the positive impact this will have on prospective buyers, is encouraging, but it’s only a first step,” Mr Balazs said.
“Central to the REIV’s blueprint is striking the right balance between supporting the interests of both prospective buyers and vendors in the context of residential property transactions. This means Government avoiding a heavy-handed approach that places an excessive regulatory burden on vendors, while not adequately protecting their fundamental right to achieve the best possible sale price.
“Key to achieving this vital policy balance is the Government considering the blueprint’s other recommendations and revisiting its proposed mandatory seven-day reserve price disclosure requirement for auctions. Having the potential to trigger inflated reserve prices, a fall in clearance rates and an increase in offers prior to auction, this flawed requirement threatens to compromise the transparency and effectiveness of the public auction process.”
The REIV will seek to continue to engage constructively with the Government to ensure a balanced and effective regulatory response to this critical industry issue.