It's the bane of every house hunter's existence.

You find your dream home, fork out a small fortune on building reports and place your bid ... Only to watch it go under the hammer for way more that the advertised price.

In some cases, houses are being sold for as much as $1 million above the advertised price, like this six-bedroom period mansion in Melbourne's Footscray.

Now Victorian real estate agents are finally being taken to task for underquoting, with fines of up to $300,000 being imposed by the courts - but experts say there is more to be done.

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The agent behind the Footscray sale landed in hot water after promoting the property online as being priced at "$1 million plus", despite having last changed hands for $1.3 million some 18 months earlier.

It sold for $2.11 million in December 2015, prompting legal action by Consumer Affairs Victoria.

As part of its industry-wide crackdown, the state government regulator took legal action against a string of real estate agents under Taskforce Vesta.

Inspectors searched for evidence of underquoting at the offices of 34 estate agents involved in sales worth significantly more than the advertised price, examining a total of 1,400 sales files.

Red flags arose when the agency agreements signed by vendors showed a reserve price much higher than the price guides used to advertise the properties.

Among the suspect files were six properties sold by Hocking Stuart Yarraville, including the Footscray house mentioned above, and seven properties sold by O'Brien Real Estate Croydon.

Those agents admitted to engaging in false and misleading conduct and agreed to pay fines of $45,000 each.

Hocking Stuart Richmond was given a record $330,000 fine, plus $80,000 towards the regulator's costs, when its underquoting allegations were aired in the Federal Court in October.

The agency's owner and director Peter Perrignon admitted that he and senior staff members had underquoted on 11 properties in the sought-after areas of Richmond and Kew between January 2014 and June 2015.

The court noted that the negative publicity surrounding the case meant that "it is extremely unlikely Hocking Stuart Richmond or Mr Perrignon will be involved in underquoting again".

"The contravening conduct was serious. Price is an essential piece of information about the property being offered for sale for prospective buyers," Justice John Middleton said in his written decision.

"Buyers should be able to rely on correct information to make an informed decision."

He said the selling agents had created "an enticing marketing web" that created the "illusion of a bargain" in the minds of potential buyers.

"Many consumers seeking to buy a home were likely to be significantly inconvenienced, disappointed and deceived," Justice Middleton wrote.

"Some may have missed the opportunity to buy elsewhere, being lured to a bargain that did not, and was never going to, eventuate."

Aerial view of suburban houses in Melbourne, Australia. Photo / 123RF
Aerial view of suburban houses in Melbourne, Australia. Photo / 123RF