Edition 49, September 2007

ACCC allows WA real estate agents to amend auction code of conduct

The Australian Competition and Consumer Commission has allowed the Real Estate Institute of Western Australia (REIWA) to amend its auction code of conduct. The variation allows REIWAagents to place bids for sellers in court-ordered auctions.

Courts such as the Family Court have the power to order that a property (for example, a disputed house in a divorce settlement) be auctioned without reserve. When these orders are made, the party ordered to sell the house may bid in the auction in order to retain ownership.

The REIWA Auction Code of Conduct prohibits REIWA real estate agents from placing bids on behalf of the seller of the property. This is to stop sellers from artificially inflating auction prices at the expense of buyers.

The amendment will allow sellers to place bids, but only in the particular circumstances of a court-ordered auction with no reserve price. This addresses an unintended consequence of the original code, while continuing to protect consumers from misleading conduct such as artificial price inflation and dummy bidding.

 

For more information visit www.accc.gov.au (Select 'Public registers' > 'Authorisations and notifications registers' > 'Authorisations register')

This nformation is reproduced under licence from the ACCC

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