Passed In Again? How to Beat Underquoting at Melbourne Auctions in 2026

Melbourne buyers are asking an increasingly familiar question: why are properties still being passed in at auction when sellers and agents have had weeks to gauge buyer interest? The latest Melbourne auction results have not settled the argument.

Frustration over unrealistic price expectations, confusing price guides and pressure to make pre-auction offers has become a recurring theme in Melbourne property discussions. But the numbers tell a more useful story than the noise does.

According to Domain's Melbourne auction results, preliminary figures for the week ending 17 October 2026 showed a clearance rate of approximately 52%, with 127 properties passed in out of 389 reported auction results (updated 18 October).

That points to challenging conditions for some sellers, but it does not mean every Melbourne suburb or property type is experiencing the same level of buyer resistance, and a Melbourne auction clearance rate below 60% should be read suburb by suburb rather than as a verdict on the whole city.

And importantly, a property passing in does not automatically mean underquoting has occurred.

What Is Underquoting in Victoria?

Underquoting occurs when a real estate agent advertises or indicates a price below certain legally relevant benchmarks, including:

• The agent's estimated selling price.
• The seller's asking price or disclosed reserve.
• A written offer previously rejected because the price was too low.

Under Consumer Affairs Victoria's underquoting rules, a property selling above its advertised price does not necessarily prove underquoting. Genuine buyer competition can push the final selling price higher.

The critical question is whether the advertising accurately reflected information available to the agent during the campaign.

What Changed Under Victoria's October 2026 Auction Laws?

Victoria introduced significant property price transparency reforms on 1 October 2026, with the new requirements applying to residential auctions and fixed-date sales held from 16 October 2026.

According to Consumer Affairs Victoria's official guidance:

• Reserve disclosure: agents must publish the seller's reserve price at least seven days before the auction or fixed-date sale.
• Single-price requirement: the disclosed reserve must be expressed as one dollar amount, not a range or a figure accompanied by terms such as “from” or “offers above”.
• Property Price Statement: the new Property Price Statement (PPS) replaces the former Statement of Information (SOI) and must prominently display relevant property and comparable-sales information.
• Sold-price transparency: agents must generally publish the final selling price within seven days after the sale becomes unconditional, subject to applicable exceptions.

If the published reserve is changed before the auction, the seven-day disclosure period starts again. However, the official industry guidance confirms that sellers can still respond to bids and market conditions during the auction.

For a more detailed explanation, read Forge's guide to Victoria's new underquoting laws and reserve price rules.

Passed In or Underquoting? How to Tell the Difference

A passed-in result and an underquoting breach look similar from the outside, so it helps to separate the two before you decide what to do next.

• A passed-in property is one where bidding at the auction simply did not reach the vendor's expectations. The advertising may have been entirely accurate.
• An underquoting issue is about what the agent knew and advertised during the campaign. If the guide price was below the agent's own estimate of selling price, or below a rejected written offer, the advertising was the problem, not the market.
• Under the new rules, the published reserve price gives you a third reference point. Compare the guide price, the reserve price and the price comparable sales actually achieved.

Where those three figures sit far apart, it is worth asking the agent directly how the guide price was established and which sales were used as comparables. You are entitled to an honest explanation of the advertising basis.

What Does "Passed In at Auction" Actually Mean?

Understanding the mechanics of a reserve price auction is the fastest way to make sense of a passed-in result, and of what happens to the negotiation afterwards.

A property is passed in when bidding fails to produce a sale at auction, commonly because it has not reached the seller's reserve price.

Under Victoria's auction guidance, the highest bidder generally receives the first opportunity to negotiate with the seller.

If negotiations fail, the agent may approach other interested purchasers or continue marketing the property privately.

For buyers, this can create an opportunity to negotiate without the immediate pressure of competing bids.

But a passed-in result does not necessarily mean the seller will accept a substantially lower price.

How to Handle Pressure to Make a Pre-Auction Offer

An agent might encourage buyers to submit an offer before auction, particularly where there is interest in securing a sale early. A pre-auction offer is not inherently suspicious, and it can benefit both buyers and sellers.

However, buyers should take precautions:

• Check the published reserve: do not assume that an offer at the reserve will automatically be accepted.
• Review recent comparable sales: determine what similar properties have actually sold for, rather than relying entirely on the asking price.
• Set your maximum price: calculate your borrowing capacity, additional purchasing costs and realistic bidding ceiling before negotiating.
• Understand contract conditions: seek legal advice and complete relevant inspections before signing.

According to Consumer Affairs Victoria's pre-auction offer guidance, buyers generally lose their cooling-off entitlement when a pre-auction offer is accepted less than three clear business days before the scheduled auction.

The Melbourne Buyer's Auction Playbook

1. Read the Property Price Statement Carefully

Review the property's indicative selling price, published reserve and comparable-sales evidence.

For metropolitan Melbourne, the standard comparable-sales framework generally considers similar properties sold within the previous six months and within two kilometres, where suitable sales are available.

The new PPS requirements also require key features of comparable properties to be disclosed, helping buyers assess whether the comparison is reasonable.

2. Investigate the Property Beyond Its Price

A low advertised price does not automatically represent good value.

Apartment buyers should examine owners corporation finances, special levies, building defects and maintenance history.

Forge's Melbourne apartment due diligence guide explains the checks worth completing before committing.

Buyers with mobility or accessibility needs should also consider entrances, stairs and bathroom layouts. Melbourne specialist Mobility Access Modifications provides examples of residential accessibility improvements, including ramps, handrails and accessible bathroom modifications. Any proposed changes should be checked for feasibility and required approvals before purchasing.

3. Know When to Walk Away

A disclosed reserve tells you something about the seller's expectations. It does not independently establish market value.

Compare the reserve against completed sales, property condition, ongoing costs and your own financial position.

If the bidding exceeds your researched limit, walking away can be a better outcome than purchasing at an unsustainable price.

4. Use Passed-In Results as Negotiating Information

When reviewing Melbourne auction clearance rates, look beyond the citywide percentage.

Compare results within the same suburb, property category and price bracket. Investigate whether comparable properties sold before auction, sold under the hammer, passed in or were withdrawn.

Our guide to auction clearance rates under 60% explains how to read suburb-level results without assuming a weak citywide number creates a buyer's market everywhere.

How Forge Real Estate Helps Buyers Make Informed Decisions

At Forge Real Estate, our approach focuses on evidence rather than auction-day pressure.

• Comparable-sales analysis: we assess relevant recent sales, property characteristics and local market conditions to help buyers understand realistic value.
• Auction preparation: we help buyers establish a bidding strategy, evaluate pre-auction offers and set a disciplined purchasing limit.
• Suburb-level insights: we examine local auction outcomes, passed-in results and selling conditions so buyers can better understand the market in which they are competing.

The Bottom Line

Melbourne's auction market is changing, and Victoria's October 2026 reforms give purchasers more information before bidding begins.

But greater price transparency does not replace independent research or disciplined decision-making.

Whether a property sells above its reserve, passes in or attracts an early offer, the smartest buyers focus on three things: what the property is genuinely worth, what risks they are accepting and the maximum price they can comfortably afford.

Disclaimer: Updated 26 October 2026. This article provides general information about Victorian residential property, auctions and property taxation, not legal, financial, tax or valuation advice. Obtain independent advice before signing a contract, bidding or making an investment decision; rules, thresholds and election policies can change.

Buying at auction in Melbourne? Contact Forge Real Estate for local market insights, comparable-sales analysis and guidance before making your next move.

Forge Real Estate Melbourne can help you blueprint your future by finding the perfect blue-chip property where your lifestyle needs and investment goals converge.

📞 Phone: (03) 91003633

✉️ Email: info@forgeproperty.com.au

🌐 Website: www.forgerealestate.com.au

We offer specialized consultation and can assist in both Mandarin and Cantonese.