Sydney’s the property underquoting capital: How does your suburb compare?

At first glance, the Sydney suburbs of Marrickville and Marayong don’t seem to have a lot in common. They’re separated by 35 kilometres and a million-dollar difference in the median house price – but both are hotbeds for misleading auction guides.

Across suburbs clustered around the inner and western parts of the city, buyers typically pay hundreds of thousands of dollars more than the advertised price to secure a new home.

This masthead has identified 38 neighbourhoods where properties consistently sold more than 10 per cent above the estimated selling price during the 18 months to June 2025.

The largest average price discrepancies were in Smithfield (29% higher), Greenacre (24%), Marayong (22%), Alexandria (17%) and Marrickville (17%). In all these suburbs, the data analysis included at least 40 sales.

An investigation by The Sydney Morning Herald and The Age, analysing 10,772 Sydney auction campaigns and 26,000 in Melbourne, has uncovered an extraordinary level of misinformation and deception faced by buyers.

Father of three Marcello D’Ambra spent eight months searching for a home near Marrickville with a budget of about $3 million. He was also trying to sell a property in the inner west suburb of Concord while living in Toongabbie, where 11 auction guides were more than 30 per cent below the eventual sale price. Toongabbie is a couple of suburbs over from Marayong in western Sydney.

“It’s a highly contested market, where if you don’t buy, someone else will, [with] between 20 and 30 rival buyers turning up at auctions, it’s pretty intimidating,” D’Ambra said.

Typically, at the start of a property campaign, inner west agents would say, “we haven’t got market guidance enough to be able to tell you what the guide is”, the commercial mortgage broker said.

“[But] the difference in most properties was anywhere between $200,000 and $400,000 in terms of the underquoting.”

It is a similar story in Alexandria, where properties typically exceed the top end of the guide by more than $225,000. Several homes have sold for almost $1 million above the estimate given to prospective buyers in the past 18 months and at least 10 traded more than 30 per cent above the agent’s guide.

D’Ambra eventually bought a converted warehouse in St Peters in March, because there was too much competition and it was “too much of a nightmare trying to negotiate with agents”.

In June last year, a three-level townhouse in the trendy inner-city suburb of Alexandria sold for more than $700,000 above the $2.4 million price guide offered to buyers by The Agency.

A large crowd, with a dozen groups holding white bidding cards, crammed into the ground level for the auction. The first offer was $1.9 million. “A reasonable start, we are going to move quickly above that,” the auctioneer quipped.

And move they did. The second bid drew shocked laughter: $2.8 million was the call, a whopping $900,000 above the starting bid and $400,000 above the guide. A few minutes later, the hammer fell at $3.11 million.

The reserve had been $2.8 million – more than 16 per cent above the guide.

Dealing with agents is “inherently tricky”, Buyers Alliance director Chris Paino said. After searching for a client in Newtown last year, he found that “every single terrace” had an auction campaign and was underquoted by about $300,000.

“If I call an agent and say, ‘mate, is this underquoted? Because my clients have an X budget’, they still never give a straight answer. ‘Oh, well, it’s an auction, so we just don’t know, just show up on the day and bid,’” Paino said. “It needs to absolutely stop, because it’s honestly a killer for people out there. I see it in my clients; they’re just defeated.”

Paino was engaged by a young family who attended a south-west Sydney auction in late June. Despite coming with a close to 20 per cent buffer above the guide, the family was outbid by six others who started $5000 over the agent’s guide.

Southwestern and western Sydney

Smithfield straddles Fairfield and Cumberland council areas, about 30km west of the city’s CBD. Median house prices here rose almost 20 per cent in the year to March 2025, according to Domain data.

It was also the worst suburb for discrepancies between the guide price for auctions and the sale price, with 20 of the 41 estimated selling prices tracked selling more than 30 per cent over the advertised guide.

Many of the auctions in this area were run by Raine and Horne Wetherill Park, whose selling principal, Sam Ruisi, said his pricing guides were “based on live market conditions, buyer feedback, and vendor instructions, not hindsight”.

Ruisi declined to explain why he estimated a four-bedroom duplex on Green Avenue in Smithfield would sell for $800,000, after he sold the four-bedroom duplex next door for $1,045,000 three months earlier.

The former property sold in May 2024 for $1,105,000, 38 per cent above the agent’s estimate.

“We look closely at comparable active listings, particularly those we’re competing with in the same marketplace,” Ruisi said. “This is a live market, not a closed-book exercise. In the event another agent lists a superior home with a lower guide to attract attention (which does happen quite often), we’re forced to factor that into our own pricing strategy, subject to our vendors’ instructions, to ensure our vendors stay competitive. Otherwise, we risk shutting out buyer traffic from the outset.”

The Herald does not suggest that Ruisi deliberately underestimated the price of this property.

In late June, auctioneer Mark King, who does not set prices, was chanting on the street during the sale of a three-bedroom house in south-western Sydney: “Ladies and gentlemen, look at the number of paddles in the crowd. You can see the demand.”

Twenty buyers registered to bid and were given a guide price of $900,000 in Mount Pritchard, a suburb in the Fairfield council area, where the median house price was $1.14 million in June. As the auction unfolded, King quipped that buyers must be “looking at this price and saying yes, please”.

But they weren’t pleased as bidding soared 32 per cent above the guide before the home was officially offered to the market at $1,190,000 and sold for $1,193,000.

Fairfield is one of Sydney’s most affordable council areas: it’s also home to the largest and most consistent gaps between an agent’s price guide and the sale price, with the average gap across 227 auctions of 23 per cent.

Several buyers’ agents singled out western Sydney as an underquoting hotspot because prices are lower and more first-time buyers, migrants and upsizers are being pushed west, meaning agents can capitalise on strong demand to lure large crowds to auctions.

“If you’re talking about where people are being impacted the most, middle-income earners are more likely to be hit and it’s going to be mostly those in western Sydney,” a buyers agent, who asked not to be named due to industry relationships, said.

The areas where prices fell closest to the guide (less than 6 per cent above) were Mosman, Manly, Chatswood, Neutral Bay and Parramatta. Median house and unit prices fell in all these areas, except Mosman, in the 12 months to June.

In Manly, Neutral Bay, and Parramatta, the sales tracked were overwhelmingly apartments, which tend to be underquoted less often because they’re easier to price due to comparable sales in the same building.

In a wealthy suburb like Mosman, where agents are reliant on repeat business, they won’t get away with underquoting, Kingsley Yates from The Agency North said.

“I’ve been in business here for 40 years, and it’s that repeat business that means I’m now selling for the kids of my original clients,” Yates said.

Ray White Mosman principal Geoff Smith said underquoting behaviour “catches up with you, and everyone around here talks about these things, so if you do start conducting your business like that, then you have about 12 months until you’re gone”.

With Aisha Dow and Lucy Macken