The Melbourne property market finished winter with a preliminary Domain auction clearance rate of 60% over the weekend, from 456 reported auctions. Of these, 274 properties sold, 62 were withdrawn and 120 passed in. This compares with a clearance rate of 70% for the same weekend last year. The REIV also reported another 477 private sales for the week.
The property market is still producing very mixed results. Good quality properties in good locations are attracting buyers and, when priced correctly, can still be very competitive. Properties with compromises or unrealistic vendor expectations are a different story and are generally taking longer to sell.
Last week, legislation was passed in Victoria introducing a number of changes relating to vendors’ reserve prices, Section 32 statements, Section 27 and Statements of Information (SOIs).
Firstly, from 1 October 2026, vendors selling by auction or fixed-date sale will need to publish their reserve price at least seven days before the sale. If the reserve isn’t disclosed within the required timeframe, the property won’t be able to proceed to auction. The advertised price will also need to reflect the disclosed reserve.
There are certainly pros and cons to this. While I support greater price transparency and measures aimed at reducing underquoting, I think there could also be some unintended consequences.
There is nothing stopping a vendor from setting their reserve higher than what they may ultimately be willing to accept on auction day or at a sale by set date (SBS). We could potentially see some of the issues around underquoting replaced with overly ambitious reserves, as vendors try to protect their negotiating position.
It may also encourage more vendors to sell prior to auction or SBS day, particularly if they receive an acceptable offer before their reserve needs to be publicly disclosed. Alternatively, some vendors may choose to sell by private sale instead. Both scenarios can pull buyers back into a less transparent negotiation process where they don’t necessarily know what other buyers are offering.
Also from 1 October 2026, the Statement of Information (SOI) will be renamed the Property Price Statement (PPS) and will need to include key features of the property being sold, as well as the key features of each comparable property.
The sale price of a residential property will also need to be added to the PPS within seven days of the sale becoming unconditional, unless an exemption applies. The PPS will then need to remain publicly available online, free of charge, for at least 18 months.
I think this is a positive change and will give buyers much better access to recent comparable sales information, particularly where properties have previously been advertised as “price undisclosed”.
From 1 June 2027, there will also be significant changes around the availability of Section 32 statements. For properties being sold by auction or fixed-date sale, the Section 32 will need to be available at least 14 days before the sale. The legislation also introduces earlier disclosure requirements for properties being sold by other methods.
Giving buyers more time to have contracts reviewed and complete their due diligence is a positive thing, but I am interested to see how this is going to work in practice. We regularly see properties bought and sold very quickly, sometimes within days of coming onto the market, so this could have quite an impact on the way some properties are sold.
Also from 1 June 2027, the existing Section 27 early deposit release process will be repealed and replaced with a new process. Early release of a deposit will still be possible where it has been agreed between the parties as part of the contract of sale.
The changes will also restrict the circumstances in which selling agents can take their commission from the deposit before settlement. I am not sure what advantage this particular change provides to either vendors or buyers. For example, some property transactions have settlements of 12 months or longer. If an agent has to wait until settlement to be paid their commission, there may be less incentive for them to encourage or accommodate a longer settlement, even when those terms suit both the vendor and purchaser.
There are certainly a lot of changes ahead. Some I think will be very positive for buyers, while others may have consequences that are perhaps not as favourable.
We probably won’t really understand the full impact until the new rules have been operating for a while, but it will certainly be interesting to see how the property industry, vendors and buyers adapt.
Have a great week.
Kim Easterbrook – Managing Director
