4 Underhanded Real Estate Tactics You Need to Know About

4 Underhanded Real Estate Tactics You Need to Know About

In survey after survey, real estate agents consistently rank among the least trusted professionals in Australia. And it’s not hard to see why.

When you combine high commissions, low barriers to entry, and a lack of strong regulation, you create the perfect conditions for unethical behaviour to thrive. Add in the emotion and pressure of buying or selling a home, and many people find themselves outmatched by smooth-talking agents who don’t always have their best interests at heart.

At Trow Jones, we’re calling it out. We’ve seen too many buyers and sellers taken advantage of, and too little done by regulators to address it. After speaking out on Four Corners and A Current Affair about misconduct in the industry, we’re continuing to shine a light on the dirty tricks still in use today.

Here are four of the most common tactics you need to watch for. Forewarned is forearmed!

1. ‘Buying’ listings

When it’s time to put your property on the market, you should interview several agents. Each one will give you an estimate of your property’s value, and it’s possible these estimates might vary widely, often by hundreds of thousands of dollars, and sometimes by millions.

While it can be tempting to go for the highest appraisal, please note that most agents will deliberately overvalue your property just to win your business. 

Although it's initially exactly what you want to hear, when you're given an inflated appraisal, it can take a huge emotional toll when you're eventually forced to reduce the sale price to reflect the actual market value of the property. It’s even worse if you have committed to another property purchase based on a sale price you were never going to achieve, leading to unnecessary stress and financial strain.

2. Overpromising and underdelivering

Agents will promise you the world when they’re trying to get you to sign on the dotted line. But once they’ve won your business, they’ll hand over your listing to an inexperienced junior agent and focus their own efforts on winning the next listing. Their future sales pipeline is more important to them than the price they achieve for your property.

Some of the busiest agents hold 20-30 open homes per Saturday, which means that even if they wanted to attend all of them, they couldn’t. Instead, the juniors are left to deal with buyers before rushing off to the next open home. When it comes time to negotiate the final sale, critical insights from early buyer conversations can be lost in the handover, and you’re the one who pays the price.

3. Underquoting

Most agents will 'underquote' – i.e. advertise a guide price for a property much lower than the true value – to stimulate buyer interest, create competition and fill their database, where their pipeline of future sellers comes from.

Underquoting is illegal because it wastes buyers' valuable time and forces them to pay for reports (such as building, pest, and strata) and for contract reviews by solicitors on properties that were never even close to their budget.

Underquoting can be an effective strategy, especially in a hot market. However, when underquoting fails, it fails spectacularly, because if a property attracts limited competition, buyers are highly unlikely to raise their bid from the underquoted price level to the real price you are expecting.

The serial underquoters make life hard for honest agents because many buyers have become conditioned to add anywhere from 15% to 40% to a property's advertised guide price, even when the home is priced accurately. Honest agents have to work harder than dishonest ones to get prospective buyers through the door.

4. Dummy Bidding

Thankfully, dummy-bidding occurs less frequently at live auctions than it did previously. However, unscrupulous agents have now adopted a different tactic. They will encourage buyers to make bids ahead of auctions (which is legal) and then trick the buyers to increase their price by telling them about fake bids (which is illegal). It's common these days for real estate agents to manufacture phony text messages and emails to ‘prove’ they’ve received these non-existent bids. Like underquoting, this tactic can work well in some negotiations, but backfires when buyers smell a rat.

We created Trow Jones Property Advisory to protect buyers and sellers from exactly this kind of conduct. Our mission is to connect you with ethical, experienced agents who operate with transparency and professionalism. Whether you're an overseas buyer, expat, or local seller, we’re here to help you navigate the market with clarity and confidence.

Decoding the psychological undercurrents of the Australian real estate landscape takes years, and it’s not something that can be fully captured in a single blog post. If you have specific questions or a situation you'd like guidance on, please don’t hesitate to get in touch. We’re here to help.