Imagine discovering that the person you trusted to sell your home secretly bought it themselves and then flipped it for a huge profit. That's the allegation rocking Melbourne's real estate scene right now. A prominent real estate agent is under scrutiny for allegedly engaging in secret property flips, and the potential consequences could be severe. But here's where it gets controversial... is it a clear-cut case of misconduct, or is there more to the story than meets the eye?
According to reports, Consumer Affairs Victoria is investigating Robert Krnjeta, a well-known and highly successful real estate agent, following claims that he secretly purchased two properties he was entrusted to sell. Krnjeta, just 34 years old, was once the managing director and part-owner of Ray White's top-performing sales office in Victoria, Ray White Werribee. His reputation as "one of the real estate industry’s most accomplished agents" is now under a cloud.
Ray White stated that they severed ties with Krnjeta in May after his business partner discovered what they deemed illegal activity: that he allegedly took commissions for selling two homes that he had, in fact, purchased himself. This discovery, they say, prompted a report to Consumer Affairs Victoria. It is important to note, and we want to make this clear, that this article does not suggest Krnjeta is guilty of anything, but simply that these allegations have been formally reported to the relevant authorities.
Krnjeta, however, offers a different narrative. He contends that Ray White raised no concerns about any alleged breaches until after he announced his departure to rebrand and expand his business with rival franchise Harcourts. This raises a critical question: was this a genuine attempt to address misconduct, or a retaliatory move triggered by Krnjeta's decision to join the competition?
Let's delve into the property purchases themselves. Public records confirm that a company linked to Krnjeta acquired two properties in Melbourne's western suburbs and subsequently sold them for substantial profits within a year. In 2024, the company purchased a three-bedroom house in Wyndham Vale for $380,000. Domain records indicate this was among the lowest-priced three-bedroom homes sold in the area that year. Following renovations, the property was auctioned off just six months later for a significantly higher price of $527,000.
Around the same time, the same company managed by Krnjeta bought another three-bedroom property in Wyndham Vale for $350,000. This too was among the cheapest three-bedroom houses sold in the suburb that year. After renovations, it was resold, with the listing agent touting it as a "magnificent example of contemporary living," for a whopping $635,000 – an increase of over 80% in less than a year! And this is the part most people miss: these quick flips, while profitable, are what raise red flags about potential conflicts of interest.
The legal framework in Victoria, specifically the Estate Agents Act, explicitly prohibits agents from gaining a "beneficial interest" in properties they are commissioned to sell. The law aims to prevent situations where agents might exploit their position for personal gain, potentially at the expense of their clients. There are exceptions, but they involve strict conditions, including obtaining the homeowner’s explicit consent and foregoing any commission on the sale. Violations can result in hefty fines of almost $49,000 or even imprisonment for up to two years.
Krnjeta acknowledges that his business received commissions on the sale of both Wyndham Vale properties. However, he argues that his actions did not violate the Act. He claims he only purchased the homes because the initial buyers, who had signed unconditional contracts, were unable to secure financing. "I agreed to purchase the properties from that purchaser via contract nomination on the same terms, reimbursing the purchaser for the deposit monies paid," he stated.
Ray White Group's head of media, Alex Tilbury, paints a different picture. She says Krnjeta's business partner discovered the purchases in May of last year and immediately reported him to Consumer Affairs Victoria. She also stated that, eight months later, Ray White has received no update from Consumer Affairs Victoria regarding any investigation. "Ray White is not satisfied with CAV’s handling," she said, adding, "We are prepared to make the tough calls, even if it is detrimental to our business, to improve the standards of the real estate industry."
Krnjeta claims he also self-reported the situation to Consumer Affairs. He further claims he proactively repaid the commissions and provided "substantial additional compensation" to the original homeowners "to protect my good name and professional standing." Accusing senior staff at Ray White of taking his departure personally, he alleges they are "going to all lengths to damage my reputation" and that his move to Harcourts was "driven purely by commercial considerations."
In September, Harcourts announced Krnjeta as the new managing director of Harcourts Greater Melton. A press release lauded him as "one of the real estate industry’s most accomplished agents." Harcourts Australia chief executive Adrian Knowles stated, "Rob has achieved every single accolade … at his previous brand. That he has decided to move to Harcourts is exciting and flattering. I can’t wait to see his plans for his new role."
However, Knowles later stated that Harcourts was unaware of the specific allegations surrounding Krnjeta's departure from Ray White until recently being contacted by the media. He wouldn’t comment on whether the allegations were being investigated further. "Mr. Krnjeta joined Harcourts at the end of last year and came to us highly recommended by senior Ray White executives. He has consistently rated amongst his previous brand’s highest performing agents," Knowles wrote. "Harcourts has robust systems and processes in place to which all agents are expected to adhere."
Consumer Affairs Victoria has declined to comment on specific cases but affirmed its commitment to investigating reports of real estate misconduct. A spokesman stated, "Consumer Affairs Victoria takes reports of real estate misconduct seriously and will investigate and take action where necessary.” But Consumer Affairs has frequently been derided as a “toothless tiger”. In the past financial year, the number of sales campaigns monitored by the regulator’s underquoting taskforce fell sharply, as did the number of infringement notices issued.
So, what's the takeaway? A top real estate agent is facing serious allegations of unethical conduct. While he denies any wrongdoing and claims his actions were justified, the situation raises important questions about transparency and potential conflicts of interest in the real estate industry. But here's a point of contention: Is it possible that Krnjeta acted within the letter of the law, even if his actions appear questionable? And if so, does the law itself need to be re-evaluated to better protect consumers? What do you think – is this a clear case of misconduct, or is there room for a more nuanced interpretation? Share your thoughts in the comments below.
