An auction is an event where property or goods are sold to a group of competitive bidders. As auctions are open to the public, there is often a wide range of bids, with bidders competing to win the items of his or her choosing. Consequently, items sold at auction can sometimes sell for very high prices. An auction creates a free competitive market, where the bidders can determine how much they are willing to pay for each item. This saves you from having to determine the pricing.
Reasons to use an Auction House
Auctions actually go back thousands of years. As they are still occurring, there must be a strong reason why auctions work. Auctions, it turns out, are the most efficient and effective methods for selling property at market value, especially high value items. Professional auctioneers not only have years of experience but also a strong educational background in the realm of the auction industry.
Potential benefits of using an auction house include:
- Creates a competitive market
- Seen as being fair to both buyers and sellers
- Meets all government and probate regulations
- Creates a unique sense of excitement and urgency
- Your property is seen by a larger group of qualified buyers
How to Find an Auction House
First, you need an auction house that is willing to take on the sale of your items. Auction houses make their profit by charging fees to both the sellers and the buyers. As such, they are not willing to take on the sale of items that they feel will not sell, or will sell for a low price. Consequently, depending on what items you want to sell, it may be difficult to find an auction house willing to take on the sale of your property. Obviously, auction houses are more willing to accept higher value items on consignment.
You want to find an auction house that typically sells the type of assets you are looking to sell. Each auction houses typically has its own unique market niche. Therefore, each attracts certain sets of buyers, based on what merchandise they typically offer for sale at their auctions. You want to choose an auction that will show your property at its best. You will also want to look at the sales commission charged by the auction house, to determine if selling your property through that particular establishment is financially advisable.
Valuations of your Property
Most auction houses offer valuations free of charge. The best and easiest method is to take pictures of the items you want to sell and email them to the auction house. Take the pictures in a well-lit area and ensure that any identifying marks can be seen in the picture. If you know the provenance of an item, be sure to include that with the picture as a strong provenance can definitely increase the potential sale value of an item. Provenance is a record of previous owners of an item, or where the item originated. The provenance is used as a guide in determining the quality, authenticity, and potential worth of an item.
Remember, there is no guarantee that all of the items you consign to an auction house will sell. Buyers are always looking for a good deal, and this is true for auction buyers as well. While you may see the item as having value, that does not necessarily mean that someone else will too. On average, 70% of items available at an auction sell and the remaining 30% do not. While the auction house may have post-auction sales for these items, they will definitely sell at lower prices. If any of your items do not sell, you will need to pick them up immediately, or be faced with storage fees. You will still need to pay the auction house any insurance and marketing fees.