Victorian property sales now bound by higher disclosure standard

It relates to section 12(d) of the act, which now reads, “Any person who, with the intention of inducing any person to buy any land...

(d) makes or publishes any statement promise or forecast which he knows to be misleading or deceptive or knowingly conceals any material facts or recklessly makes any statement or forecast which is misleading or deceptive

shall be guilty of an offence against this Act.”

The institute said this means it is an offence if a vendor or agent knowingly conceals a material fact about a property for sale with the intention of inducing a potential purchaser to buy the land.

“It will be sufficient to amount to an offence if a vendor or agent withholds a material fact which the vendor or agent knows to be material,” it outlined.

Penalties for a breach to this law could include a 120-penalty unit fine ($19,826.40 as at 2 March) or 12 months of imprisonment.

At the present time, there is no published guideline for how the courts, and relevant persons, should interpret this rule.

Therefore, it’s impossible for vendors, agents and real estate agents to know or anticipate the extent to which a court is likely to give regard to any future guideline, the institute flagged.

In the meantime, the REIV has advised that all estate agents “should take positive steps to inform any potential purchaser of any matter that might be considered as a material fact”.