Why Could Melbourne Auction Reserve Prices Soon Become Public Knowledge?

As at 15 July 2026, Victoria’s Consumer Legislation Amendment Bill 2026 remains before the Legislative Assembly at the second-reading stage. If passed in its current form, the Bill would require agents to publish a residential property’s exact reserve price as a single dollar amount for at least seven days before a Melbourne auction or fixed-date sale.

The relevant amendments are drafted to commence on 1 October 2026, although auctions and fixed-date sales held within the first 14 days after commencement would receive a transitional exemption. Until the Bill passes Parliament and receives Royal Assent, these remain proposed Victorian auction reserve price rules rather than current law.

The reform targets underquoting and the costs buyers can incur reviewing contracts, arranging inspections and preparing finance for homes that were never realistically within budget. The Real Estate Institute of Victoria has opposed the model, arguing that mandatory disclosure may lead sellers towards less transparent sale methods.

What Underquoting Actually Means

Under Victoria’s existing underquoting laws, underquoting can occur when a residential property is advertised below the agent’s estimated selling price, below the seller’s asking price or below a written offer the seller has already rejected.

A large difference between the advertised range and final sale price does not automatically prove underquoting. Strong competition can push an auction well above expectations. The legal issue is whether the agent’s price representations were reasonable and compliant with the information available during the campaign.

Underquoting is already unlawful under the Estate Agents Act 1980 (Vic), alongside broader protections against misleading representations under Australian Consumer Law. Consumer Affairs Victoria’s permanent Underquoting Taskforce had issued more than 200 infringements totalling more than $2.3 million by late 2025, as well as hundreds of official warnings.

The proposed reform addresses a particular timing problem. Agents currently prepare a Statement of Information containing an indicative selling price and comparable sales, but the seller may not set the auction reserve until the day of the auction. Consumer Affairs Victoria acknowledges that the final reserve may be higher than the earlier advertised range when market interest increases during the campaign.

How the Proposed Reserve Price Disclosure Rule Would Work

Before an auction or fixed-date sale, the agent would have to ask the seller in writing to confirm a reserve price. The figure would need to be expressed as one exact dollar amount—not “from $800,000”, “over $800,000” or “$800,000+”.

The confirmed reserve would then have to appear in advertising for at least seven days immediately before the auction or fixed-date sale and remain published until the sale event. If the requirement were not met, the agent could not conduct the scheduled auction or fixed-date sale.

The Bill does not expressly use the word “locked”. In practical terms, however, a newly changed reserve would not have been published for the full seven-day period immediately before the sale. A late change could therefore require the auction or offer deadline to be postponed so the publication period could begin again.

Advertisements containing a price below the seller’s confirmed reserve would also need to be amended or removed. Online advertising would generally need to be corrected within one day of the agent receiving the reserve, while other advertising would need to be updated as soon as practicable.

For example, an apartment initially marketed at “$700,000–$770,000” with a later confirmed reserve of $820,000 would need to display the $820,000 reserve during the final seven days. The earlier price range could not continue to appear as though it remained the relevant buying threshold.

Would a Published Reserve Guarantee a Sale?

No. A published reserve would provide buyers with far more information about the seller’s stated expectations, but it would not be a valuation or a promise that the property will sell for that amount.

The Bill’s statement of compatibility says sellers would not be legally compelled to sell merely because a bid meets or exceeds the disclosed reserve. Buyers should therefore treat the published figure as an important pricing signal—not an enforceable right to purchase the property or proof of fair market value.

Competitive bidding may still take the sale price considerably higher. Conversely, a property may pass in below reserve and move into private negotiation, where price and contract terms can change. Forge’s guide to Melbourne auctions in a softer clearance-rate market explains why suburb-level comparable sales and a predetermined walk-away figure remain more useful than treating a reserve as a valuation.

Auctions, Fixed-Date Sales and Expressions of Interest

The reform would apply to residential auctions and “fixed-date sales”. The Bill defines a fixed-date sale as a method where the seller sets a date and time by which prospective purchasers must submit an offer to the agent.

That definition means many campaigns promoted as Expressions of Interest or “offers closing” would likely be covered if they require offers by a specific deadline. An EOI campaign would not automatically provide a way around reserve disclosure merely because bidding takes place privately rather than in public.

A conventional private treaty campaign with no fixed offer deadline would fall outside these specific seven-day reserve-publication provisions. The REIV argues that this distinction could encourage some sellers to choose private or off-market negotiations instead of auctions. Buyers considering quieter campaigns can compare the risks through Forge’s guide to finding and assessing off-market Melbourne property.

What This Means for Melbourne Buyers and Sellers

For Buyers

A disclosed Melbourne auction reserve price would help buyers identify unaffordable campaigns before paying for conveyancing, building inspections and finance preparation. It would also make it easier to compare the reserve with the indicative selling price and genuine recent sales.

Buyers should still:

compare the property with closely matched recent sales

set a firm walk-away price based on value and borrowing capacity

complete legal and building due diligence before bidding

remember that the published reserve may not be the final sale price.

Where a property fails to reach reserve, understanding how to negotiate after a passed-in auction may be as important as the auction itself.

For Sellers

Sellers would need to make a pricing decision earlier and provide written confirmation of the reserve. They would have less ability to wait until auction morning and respond to crowd size, bidder registrations or last-minute buyer feedback without affecting the scheduled sale.

That makes accurate comparable-sales analysis and realistic pricing more important. Setting the reserve too high could discourage bidders before auction day, while setting it too low would publicly reveal a figure that may weaken the seller’s negotiating position.

A Melbourne buyer’s advocacy service such as Forge Real Estate can assess a disclosed reserve against recent comparable sales, building condition, owners corporation liabilities and current suburb-level demand rather than relying solely on the agent’s marketing range.

Buyers should also consider whether the property will remain practical for their household over time. Where ramps, safer bathrooms, wider doorways or other accessibility works may be required, Mobility Access Modifications can help assess and deliver accessible home modifications across Greater Melbourne before those costs are built into a buyer’s final budget.

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

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