Balazs: Victoria's Reserve Price Rule Has the Right Aim and a Difficult Mechanism

Balazs: Victoria’s Reserve Price Rule Has the Right Aim and a Difficult Mechanism

23000 Series — Scope & Inclusion Criteria

The Australian Property Network’s (APN’s) 23000 Series is the attributed opinion layer of the APN Codex. It presents the recorded perspective of an identified practitioner whose observations bear on active node conditions, without constituting APN’s own analytical position. Policy Commentary & Critique (23400) carries perspectives on the structural and operational consequences of policy. This perspective bears on Tenancy & Consumer Protection Law (21370): Victoria is the first Australian jurisdiction to require a seller’s reserve price to be published before an auction, and the chief executive of the agents’ peak body sets out how it will work in practice. The speaker represents the estate agents who must comply with the rules, and his statements are presented as his own attributed analysis, not as verified fact.

What the Rules Require

Consumer Affairs Victoria’s guidance sets out the changes and their dates. From 1 October 2026 a new Property Price Statement replaces the Statement of Information, with more detail on the property and on each comparable sale, and must be displayed prominently in online advertising. For any auction or fixed-date sale held on or after 16 October 2026, the agent must publish the seller’s reserve price at least seven days beforehand, as a single dollar amount without words or symbols such as “from” or “+”. A sale held on 16 October therefore needs its reserve published by 9 October. Sales before 16 October run under the existing rules. Later stages follow: earlier availability of the vendor’s section 32 statement from 1 June 2027, changes to early release of deposits and to commission from 1 July 2027, and reporting of sold prices from 1 December 2027.

Attributed Perspective — Toby Balazs, Chief Executive Officer, Real Estate Institute of Victoria

Balazs says the institute supports the intent of the legislation, which is to end underquoting, but regards its execution as poor and likely to have unintended consequences. He traces the reform to heightened attention on underquoting in mid-2025, when the institute convened a working group to recommend how to address it. His central objection is that the rules blur the distinction between an agent’s estimated selling range, which is the agent’s professional judgement, and a reserve, which is the seller’s choice. Under the new process the agent suggests a reserve, and the seller either accepts it in writing or asks for another suggestion until one is agreed. He advises agents to keep a complete written record of that exchange, because in his view the regulator will look to agents, not to sellers or buyers, when a campaign is questioned.

On what does not change, Balazs is specific. In his reading, the new requirements apply up to the start of the auction and not after it: once bidding has been called, the existing auction rules govern, vendor bids are unaffected, and a seller may still lower the reserve during the auction and sell. Nothing in the legislation, he says, compels a seller to sell when bidding passes the published reserve; a seller who declines is within their rights, and the agent’s protection is the written record showing the reserve that was agreed. He expects such cases to be at the margins, since most sellers who reach their reserve will sell. A change to the published reserve before the auction, however, restarts the seven-day period.

Most of the agents’ questions concerned what counts as a fixed-date sale. Balazs’s advice is that naming a date and time for offers in a private sale risks the campaign being treated as a fixed-date sale, bringing in the seven-day reserve requirement; he points to a Consumer Affairs Victoria note that a boardroom auction triggers the same requirement, and in his reading so does an expressions-of-interest campaign with a closing date. He recommends that agents in private-treaty campaigns ask for best offers without naming a deadline. A genuinely off-market sale, never advertised, is outside the rules in his view; a “pre-market” listing on any website is advertising. Offers made before an auction may still be accepted above or below the reserve. He flags one point he regards as unresolved: the regulator’s guidance requires the estimated selling range to be updated after a higher offer, but not the reserve, which he says does not make sense, and which he was seeking to clarify.

Asked separately about a proposal to raise the threshold for the first home buyer stamp duty exemption to $1 million, Balazs supports a higher threshold and argues there is a case for none at all, because a threshold concentrates prices just below it: a property worth a little under the limit tends to sell at the limit, as buyers bid up to the point where the concession still applies.

Source: Toby Balazs, Chief Executive Officer, Real Estate Institute of Victoria. Live-streamed video interview — Tom Panos Real Estate Training (YouTube), “Victoria’s New Auction Rules 1 Oct 26: The Do’s & Don’ts”, 19 September 2026, host Tom Panos, with questions from agents watching. Retrieved 20 September 2026. Close paraphrase throughout; the published recording is the authoritative record of exact wording. Context: the institute represents Victorian estate agents, who carry the compliance obligations under the new rules; the briefing was addressed to agents. The host’s own views are not reproduced. Rules verified against Consumer Affairs Victoria, “New changes to property sales and underquoting laws”, retrieved 23 September 2026.

APN Clinical Reframing

The perspective separates cleanly into two parts. The first is support for the policy’s objective: the agents’ peak body does not contest that underquoting occurs or that it should be addressed. The second is a practical critique of the mechanism, and its substance is that a published reserve turns a figure that sellers have traditionally been free to set, and to change, up to auction day into a disclosed commitment, with the compliance record resting on the agent. The critique concerns where the burden of compliance falls, not whether buyers should have better price information. The speaker’s account of his dealings with successive ministers and his comments on the November 2026 state election are not reproduced: they concern the government rather than the policy, and fall outside the scope of this series.

Several of his answers are interpretations offered before the regulator’s own templates and full guidance were available, and he said as much, committing to return to them. The points most exposed to later clarification are what turns a private sale into a fixed-date sale, and how the estimated selling range and the reserve interact after an offer. Readers should treat the guidance of Consumer Affairs Victoria, not this interview, as authoritative on those points. His observation on stamp duty thresholds is a structural one that applies to any price-capped concession, and is an exploration candidate for Tax Laws (21310). The effect of the reserve rule on the choice between auction and private sale is a second: Balazs reports some agencies planning to use auctions more and others fewer, and the Victorian clearance and sales-method data from mid-October onward will show which prevailed. No figure or characterisation in this piece may be treated as an APN-certified position for any 21000, 22000 or 24000 Series node.

Disclaimer

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