Victoria's New Auction Reserve Rules: Will They Change the Way We Buy Property?
For years, one of the biggest frustrations for Melbourne property buyers has been trying to understand what a home is actually going to sell for.
You find a property advertised within your budget, spend weeks attending inspections, arrange building and pest reports, review the contract and prepare for auction, only to discover on the day that the vendor's expectations are considerably higher than the advertised price.
It's a familiar experience for many Melbourne buyers, and one that has contributed to ongoing frustration around property pricing and underquoting.
Now, significant changes to Victoria's property laws are aiming to bring greater transparency to the selling process.
From 1 October 2026, new property price disclosure requirements came into effect, including a requirement for selling agents to publish a vendor's reserve price at least seven days before an auction or fixed-date sale. The reserve disclosure requirements apply to auctions and fixed-date sales held from 16 October 2026.
It's an important change to the way property is bought and sold in Victoria. But while knowing the reserve price is certainly useful, it doesn't necessarily tell buyers everything they need to know.
What Has Actually Changed?
Traditionally, a vendor's reserve price has remained confidential until auction day. Buyers have relied on the advertised price guide, comparable sales and conversations with the selling agent to form an opinion about what a property might sell for.
Under the new rules, selling agents must publish the vendor's reserve price at least seven days before an auction or fixed-date sale. The reserve must be expressed as a single dollar amount, rather than a range or a figure described as 'from' or 'over'.
The reserve must also be reflected in the property's advertising and the new Property Price Statement, which replaces the previous Statement of Information.
If the reserve hasn't been published for the required seven-day period, the auction or fixed-date sale cannot proceed as scheduled.
The reforms also introduce greater transparency around completed sales, with agents generally required to publish the final sale price within seven days of the sale becoming unconditional, subject to applicable exemptions.
The intention is to give buyers clearer information earlier in the process, allowing them to make more informed decisions before committing time and money to a property.
Why This Is Good News for Buyers
One of the most valuable things buyers have is their time, and it's often underestimated.
Searching for a property involves much more than attending open inspections. There are contracts to review, reports to organise, finance arrangements to confirm and, for many families, weekends spent moving between inspections and auctions.
When a property is advertised at a price that doesn't reflect the vendor's expectations, buyers can spend considerable time and money pursuing a home that was never realistically within their budget.
Having the reserve price available a week before auction should help buyers identify these situations earlier.
For example, if a property has been advertised around $1.4 million but the vendor sets a reserve of $1.6 million, buyers will have a clearer understanding of the seller's expectations before auction day.
For someone whose maximum budget is $1.45 million, that information could save considerable time, expense and disappointment.
It's a positive step towards a more transparent process, particularly for buyers who may be less familiar with the way Melbourne's auction market operates.
But the Reserve Price Isn't Necessarily the Market Value
This is where I believe buyers need to be careful.
A vendor's reserve price is the minimum amount they have nominated as acceptable for the auction or fixed-date sale. It isn't an independent valuation of the property, and it doesn't automatically represent what the market is prepared to pay.
A vendor might set their reserve based on the price they need to achieve to purchase their next home, what a neighbour sold for twelve months ago or simply what they believe their property is worth.
Those expectations may or may not align with current market conditions.
Equally, a property with a reserve of $1.5 million could attract several interested buyers and sell well above that figure.
The new rules provide greater clarity around the seller's expectations, but they don't remove the need for buyers to undertake their own assessment of value.
In my view, that distinction is particularly important in the current Melbourne market, where conditions can vary considerably between suburbs, streets and property types.
Could the New Rules Change Auction Behaviour?
It will be interesting to see how the new requirements influence both vendors and buyers over the coming months.
Traditionally, some auction campaigns have relied on uncertainty around the final selling price to generate interest and encourage competition. Buyers may have entered an auction unsure whether the vendor's expectations were close to the advertised guide or substantially higher.
With the reserve now required to be disclosed in advance, buyers will have a clearer starting point.
This may discourage some buyers from attending auctions where the reserve is clearly beyond their budget. It may also encourage more realistic conversations between vendors and their agents about pricing before a campaign reaches its final week.
However, I don't expect the changes to eliminate competitive bidding.
When a quality property attracts several determined buyers, the final result will still be influenced by what those buyers are prepared to pay. Knowing the reserve doesn't prevent someone from bidding beyond it, particularly when emotions become involved.
And that's where having a clear strategy remains essential.
Will This Put Pressure on Vendors to Be More Realistic?
Potentially, and this is one of the more interesting aspects of the new legislation.
In a strong market, vendors can sometimes afford to be ambitious with their price expectations because competition may push the result higher.
But Melbourne's current property market is experiencing more cautious buyer behaviour, softer auction results and greater scrutiny around value.
Requiring vendors to nominate and disclose their reserve in advance may bring pricing expectations into sharper focus.
If a property has attracted limited interest during its campaign, setting a reserve substantially above comparable sales could make it even harder to generate competition on auction day.
On the other hand, a realistic reserve may give buyers greater confidence that a transaction is achievable.
Having worked on the selling side of the property industry, I know that discussions around price expectations can be among the most important conversations between an agent and a vendor.
The new rules may encourage those conversations to happen earlier, which could ultimately benefit both parties.
Why Buyers Still Need to Do Their Own Research
While greater transparency is welcome, there is a risk that some buyers will begin treating the published reserve as a reliable indication of value.
That's not necessarily the case.
Before bidding on a property, I believe buyers should still be looking closely at recent comparable sales, the quality of the location, land size, orientation, floorplan, condition and long-term resale appeal.
It's also important to consider the current level of competition and how the property compares with other options available in the market.
A home with a reserve of $1.8 million isn't automatically good value because the vendor is willing to sell at that price. If comparable properties suggest it's worth closer to $1.65 million, the published reserve doesn't change that assessment.
Likewise, an exceptional property may justify a price above its reserve if its location, land and overall quality support the purchase.
The reserve is another piece of information, not a substitute for proper due diligence.
What About Negotiating Before Auction?
Another consideration is how the changes might influence negotiations before auction day.
With greater clarity around vendor expectations, some buyers may feel more comfortable making an offer before the scheduled auction.
However, the right approach will depend on the property, the level of interest, the vendor's circumstances and the terms of the proposed purchase.
Making an early offer isn't always the best strategy, particularly if it reveals your position unnecessarily or encourages other buyers to act.
In some situations, waiting until auction day may be preferable. In others, negotiating before auction could provide an opportunity to secure the property without entering a competitive bidding environment.
The important thing is to approach the decision with a clear understanding of value and a strategy suited to the individual property.
What I'd Be Watching as the New Rules Take Effect
Over the coming weeks, I'll be interested to see whether greater price transparency changes the number of buyers attending auctions, how vendors approach reserve setting and whether more properties are negotiated before auction.
I'll also be watching whether the changes encourage sellers to adopt different methods of sale, particularly in a market where some auction campaigns are already struggling to generate strong competition.
It's too early to know exactly how the reforms will influence Melbourne's property market, and the impact may differ between suburbs and price brackets.
What I do believe is that buyers who understand both the new rules and the underlying market conditions will be better placed to make informed decisions.
More Transparency Is Welcome, But Buying Well Still Matters
Victoria's new auction reserve disclosure rules are a positive development for property buyers. Greater clarity around vendor expectations should help reduce wasted time, improve transparency and make the auction process easier to navigate.
But knowing what a vendor wants for their property is only part of the equation.
The real question remains whether the property represents good value at that price, how it compares with other opportunities and whether it is the right purchase for your circumstances.
At Turley Property Advocates, we draw on our experience from both sides of the property transaction to assess a property's true market value, understand the selling process and handle negotiations on behalf of our clients.
Because greater transparency is valuable, but knowing what a property is actually worth is what helps you buy well.