A Perth-based home building company that allegedly created misleading review websites for their products is being taken to court by the consumer watchdog, but the company has denied any wrongdoing.

Key points: Aveling Homes' websites allegedly made to look like company had overwhelmingly positive reviews

Aveling Homes' websites allegedly made to look like company had overwhelmingly positive reviews ACCC alleges sites were run and filtered by the company, and not independent

ACCC alleges sites were run and filtered by the company, and not independent Aveling could face fines of more than $1 million if guilty of deceptive conduct

The Australian Competition and Consumer Commission (ACCC) is taking action in the Federal Court against home building company Aveling Homes for false or misleading conduct.

It is alleged the building company, based in the northern Perth suburb of Stirling, set up websites that gave the impression they were affiliated with an independent third-party review service.

However, an ACCC spokesman said it would be alleged the company filtered out all unfavourable or negative reviews on the website.

"The ACCC alleges that Aveling created review websites that represented they were independent of Aveling, and that the appearance, layout and features gave consumers the overall impression that they were affiliated with an independent, third party consumer review website, when this was not the case," he said.

The ACCC's deputy chair Michael Schaper the potential for harm from the alleged conduct by the company was significant.

"Buying or building a home is one of the biggest purchasing decisions for Australians," he said in a statement.

"Online reviews are increasingly being relied on by consumers and they should be able to trust that those reviews are independent, unbiased and accurately reflect the range of consumer feedback received."

In a statement, the company's sales and marketing manager Sean Quartermaine said both he and the company denied any wrongdoing, and would fiercely defend the allegations.

Mr Quartermaine said no further comment could be made while the matter was before the courts.

Customer misled by online comments

One online reviewer, "Kristy", said she made the wrong decision by choosing Aveling to build her home.

"I chose Aveling Home(s) because of this website!!" she wrote.

"I saw many good comments so I choose (sic) this company.

"Now I have been waiting more than two months and the land is still the same, it means they didn't do anything … if they can't do it why they took my money???"

The ACCC also alleges that Mr Quartermaine was aware of the company's conduct.

The ACCC is seeking declarations, pecuniary penalties, injunctions, corrective notices, a compliance program, findings of fact and costs.

Mr Schaper said Aveling was facing fines of more than $1 million if found guilty of deceptive conduct.

Overwhelmingly positive reviews online

Of the 113 reviews on independent consumer website, Product Review, 58 people have given the company five stars.

Of those, 48 have only ever written one review.

The ABC spoke to one reviewer, who appeared to have genuinely built a home with Aveling and described a positive experience.

Others have not responded to a request for comment.

Editor's note 27/11/2017: The story's headline and lede have been changed from first publication, replacing the words "fake review websites" with "misleading review websites".