The property crackdown buyers and renters will love

Governments are cracking down on underquoting, AI-edited property listings and double bonds. Here's what the new rules mean for buyers, sellers and renters.

From hidden reserve prices to AI-altered rental listings, governments are introducing new rules designed to make the property market fairer and more transparent.

1. Buyers can now see a property's reserve price

This month, Victoria brought into force new rules requiring a person selling a property to be transparent about the lowest price they'll accept.

Sellers and their agents now have to share this reserve price with potential buyers seven days before an auction or fixed-date sale.

The state government is framing the reform as a crackdown on underquoting.

This is when an agent suggests a property will be cheaper than what they know it'll likely end up costing.

Dr Paul Harrison from Deakin University's business school says Victoria is the first state to require such transparency.

"It will certainly help buyers and I think it will actually help real estate agents as well," he says.

"It makes people feel more confident and I think you'll see more people genuinely being at auctions," he adds.

"[Real estate agents] will get people turning up who actually do want to buy."

Monica Rouvellas, a solicitor with Sound Counsel specialising in property law, says the change will help young people especially.

"A lot of first homebuyers spend $200 or $300 per property to do their research, only to go to an auction to find out that they're not even able to afford it," she says.

But Rouvellas also shares some of the concerns about the law raised by Victorian real estate groups.

In particular, the potential for it to deny sellers flexibility as they approach an auction date.

"If the reserve price is set too low and they need to update it, then they have to restart that seven days again," she notes.

2. AI-edited rental listings must be disclosed

From next year, landlords and agents in New South Wales will have to disclose when a rental advertisement has been altered with, or entirely generated by, AI.

It comes after Money has highlighted examples of real estate agents altering images of their properties to make them look more eye-catching.

In one case, a Queensland agency used digital tools to make it look like a property had a pool and water fountain that, in reality, didn't exist.

Dr Harrison from Deakin University says such tactics can cause potential renters to get emotionally invested in properties that aren't as good as they think.

He welcomes the incoming reform, but says agents putting a generic disclaimer acknowledging AI use won't help renters understand how exactly an image has been altered.

"They might think that once they disclose, they can do whatever they like and can put the responsibility back on the consumers," he says.

He wants the disclaimers to be more specific.

"It would be different if they actually talked about the change that was made," he argues.

"Like if it said the garden has been digitally-enhanced or the swimming pool or these windows do not exist".

3. Renters can transfer their bond to a new property

The New South Wales government is also making changes to its bond system it says will save renters up to $4000 every time they move to a new property.

The Smart Rental Bonds initiative came to life last month.

It allows renters whose security deposit has been lodged with Rental Bonds Online, the state's central holding facility, to transfer their bond from one property to the next.

New South Wales Tenants Union CEO Leo Patterson Ross says the initiative appears to be working well so far.

"It resolves a particular problem, which is when you are moving out of a home you usually have to pay for the bond at the next home before you get your old bond back," he says.

"So that means you have double the bond taken up in the system".

But Patterson Ross is critical of the $25 fee renters are being charged to use the scheme.

He also says his state could look to other parts of the country for ideas on how to better help people leasing a home.

"The ACT and Victoria are probably the two that have come the furthest and give the best deal [to renters]," he notes.

Get stories like this in our newsletters.