Reserve Price Transparency at Australian Auctions

Victoria is about to do something no other Australian state has done. Real estate agents will be required to publish the seller’s reserve price at least seven days before any auction or fixed-date sale, coming into effect 1 October. Fail to disclose it, and the property cannot proceed to auction or sale.

For property investors who have spent years decoding vague price guides and guessing where a vendor’s floor sits, this is a significant shift. You will know the number before you walk through the door. The question is whether that number tells you what you think it does.

What the law actually requires

The Consumer Legislation Amendment Bill 2026 was introduced to Victorian Parliament on 3 June 2026 as part of a broader package covering renter protections and home buyer fairness. It has passed the Legislative Assembly and moved to the Legislative Council, where it may still be amended or blocked in the Upper House.

The core mechanics:

• The vendor’s reserve price must be published at least seven days before auction or fixed-date sale.
• That reserve must be expressed as a single dollar amount. No qualifiers like “from,” no symbols, no ranges.
• All marketing materials must be updated to reflect the reserve price. Previous advertising that does not contain the reserve price must stop.

This is not a suggestion or a guideline. If an agent fails to disclose within the timeframe, the auction cannot proceed.

Why underquoting has been so hard to stamp out

The problem the law targets is straightforward. Underquoting occurs when an agent advertises a property at a price significantly below the seller’s reserve or market expectations. It is already illegal under federal consumer law and subject to state-specific legislation. But enforcement has been challenging, in part because reserve prices have never had to be made public.

Under the current system, Victorian auction rules allow agents to provide a price guide but do not mandate disclosure of the seller’s reserve price before the auction. That gap between the guide and the reserve is where underquoting lives.

The scale of it varies by city. A Guardian Australia analysis found that underquoting is more prevalent in Sydney (20% of sales) and Perth (18%), and least prevalent in Canberra, Hobart and Darwin. The mismatch between price guide and final sale price is worse for houses than townhouses or apartments, and much more likely at auction than at private sale.

Behavioural economics explains why this matters so much on auction day. Buyers anchor their expectations to low advertised prices, even when unrealistic, and loss aversion drives them to bid aggressively to avoid missing out. Large crowds at an auction signal high demand, amplifying herd behaviour. The result is the “winner’s curse,” where the successful bidder pays more than the property’s intrinsic value.

If you have ever walked away from an auction wondering how the price climbed $200,000 above the guide, that sequence of anchoring, loss aversion and crowd pressure is why.

What changes for buyers

Knowing the reserve price in advance strips away one layer of guesswork. You can run your comparable sales analysis against a real number, not a range designed to generate foot traffic. You can set your walk-away price before the auctioneer starts talking.

The transparency may reduce uncertainty and temper emotional bidding, giving buyers clearer signals about affordability. That is the upside.

The downside: if vendors respond by setting more ambitious reserves, the same transparency could anchor buyer expectations higher and sustain competitive pressure. A reserve price is a floor, not a ceiling. Knowing the floor does not tell you where the bidding will finish.

Agents who underquote already face fines of more than $48,000 and risk losing their commission. With the reserve now public, the distance between it and the price guide becomes measurable.

For investors buying at auction, the practical change is this: you will have seven days to assess whether a property’s reserve aligns with your own valuation. Use them.

The EOI loophole

Reserve price transparency only applies to auctions and fixed-date sales. Expression of interest (EOI) campaigns sit outside the requirement.

Concerns have been raised that agents could turn to expression of interest campaigns, where buyers are invited to submit their highest and best offer with no set timeframe, rather than rely on auctions for all sales.

The REIV has also pushed back, describing the government’s approach as “a disproportionate response that risks disadvantaging vendors in its current form”.

There is a legitimate vendor-side concern here. A typical Melbourne auction campaign runs around three weeks, covering four weekends of open inspections. The first week reveals who is curious. The second shows who is serious. The final week shows who is prepared to act. The law forces vendors to commit to a reserve before that process plays out, asking them to make a major call before the market has fully revealed itself.

Whether agents actually shift en masse to EOI is an open question. Auctions are deeply embedded in Melbourne’s property culture. But if you are an investor watching a property suddenly switch from auction to EOI mid-campaign, that shift itself is information worth noting.

Sold prices go public too

The reserve price requirement gets the headlines, but a companion provision matters just as much for long-term research. Once a home sells, the sold price must be made public, so buyers can see what homes in an area are actually worth.

For investors who rely on comparable sales data to value properties, this is a quiet but significant improvement. Sold price data in Australia has historically been patchy, delayed, or locked behind paid platforms. Making it public by law creates a better foundation for every valuation you run going forward.

What other states are doing

Victoria’s law is the first of its kind in Australia. No other state requires reserve price disclosure before auction.

NSW is tightening underquoting penalties, but its approach focuses on mandating price guides on all advertising and a statement of information backing up the estimated sales price. That is a transparency improvement. It is not reserve disclosure.

Queensland is unlikely to follow, as its policy philosophy favours banning price guides altogether rather than adding new disclosure rules. A fundamentally different direction.

Auctions are most common in Victoria, New South Wales and the ACT. If you are investing in Brisbane, Perth or Adelaide, the auction process is a smaller share of the market and these changes will have less direct impact on your buying strategy.

Will this change property prices?

Probably not in any meaningful way. Structural drivers like supply constraints, population growth and interest rates will continue to dominate price trends. Auctions may become more rational, but prices in high-demand areas are likely to remain high.

What the law changes is the process, not the outcome. It makes auctions fairer without making properties cheaper. For investors, that distinction matters. A transparent auction is still an auction. Your edge comes from knowing the market, running the numbers, and having a walk-away price before the bidding starts.

If you want structured support for that process, from suburb research through to auction day, PropSpotter’s coaching program is built for investors who want to learn the skills rather than outsource every decision.

FAQ

What is reserve price transparency at auction in Australia?

Reserve price transparency means the seller’s minimum acceptable price is disclosed to buyers before auction day. Victoria’s Consumer Legislation Amendment Bill 2026 is the first Australian law to require this, mandating that agents publish the reserve at least seven days before auction.

When does Victoria’s reserve price law take effect?

The law comes into effect 1 October. As of July 2026, the Bill has passed the Legislative Assembly and is in the Legislative Council, where it may still be amended.

Will other states follow Victoria’s reserve price law?

No other state has announced equivalent reserve price disclosure reforms. NSW is tightening underquoting rules through mandatory price guides, while Queensland’s policy philosophy favours banning price guides rather than adding disclosure requirements.

Can agents avoid the law by using expression of interest campaigns?

The reserve price disclosure requirement applies to auctions and fixed-date sales. Expression of interest campaigns, where buyers submit offers with no fixed timeframe, sit outside the requirement. Whether agents shift to EOI to avoid disclosure remains to be seen.