False price strategies include both the ‘offers above’ method (illegal in some states) and any of the price-range strategies. There are many variations of these strategies: ‘offers from $500 000-plus’, ‘offers above’, ‘offers between’, price range or even price indication. All variations work on the assumption that the owner may not accept the lowest price quoted but will consider a figure above this amount.
In 2016, New South Wales passed laws prohibiting the use of the ‘offers above’ or any similar method, with Victoria following suit in the same year.
This legislation was enacted to protect buyers from investing time, money and energy into a property they can’t afford. By advertising a price lower than market value with ‘offers above’, buyers are encouraged to enquire. However, being far below what the seller will accept makes this advertised price false and misleading. Many buyers have lost money believing an advertised price.
As of the beginning of 2018, all other states still permit this form of marketing. However, even in New South Wales and Victoria, the legislation was not designed to protect the seller against an inflated price suggested by an agent.
As with all pricing methods that don’t use a stated asking price, the focus of the buyer and the hopes of the seller diverge. The buyer expected a bargain, while the seller is encouraged to use this method in the hope that these is no cap on an eventual selling price.
This strategy sounds plausible to a seller, but it’s deceptive and has hidden dangers that cost you money without you even realising it.