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Agents have been told they could seriously damage their reputations if they offer forecasts about a property’s potential.
Property Investment Professionals of Australia chairman Ben Kingsley said agents should limit themselves to statements of fact when dealing with investors.
“As much as you’re there to put the best light on the property, the reality is you can’t make any strong claims about future performance and you’re not qualified to do so,” he told Real Estate Business.
“I’d be very careful in terms of trying to create hype around where the market is going or that all properties are winners, when in reality we know that in the current marketplace some of these gains are going to be given back once the peak is over.”
Mr Kingsley said there’s no harm in agents making general statements that a property could be considered for investment purposes.
However, he added that agents could risk damaging their reputations and losing future listings if they make forecasts that ultimately prove untrue.
“The reality is most real estate agents don’t know the drivers behind what makes for a good investment and only know their own local marketplace,” Mr Kingsley said.
“They might think something makes for a good investment, but there could be better opportunities elsewhere.”
[Related: Reserve Bank issues warning about investor activity]
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