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.
No Guarantee
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.
FAQs
If you decide to submit your items to auction (known as consigning), the auction house will guide you through the process. It will ask you to sign a consignment agreement which details the auction house's terms and conditions – always read it carefully and ask about which charges will apply to your items.
What sells most in an auction? ›
At Joshua Kodner Galleries, we're often asked what the best items to sell at auction are. While the simple answer is anything of value, the more complex answer goes deeper than that. Antiques, fine artwork, and classic jewelry see the best returns at an auction most of the time.
How to auction an expensive item? ›
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.
Is it worth selling goods at auction? ›
As a rough guide; selling through an auction is ideal if you want to market your items to a wide audience. Auctions are suited to items that have a subjective value or are of low commercial value. Private sales are well suited to items with an objective value, or where direct comparison with previous sales can be made.
What percentage do most auctioneers take? ›
Typically, auctioneers charge around 10% to 20% of the gross sales as their commission. Sometimes, they might also receive bonuses depending on the specific deal. It's important to note that auctioneer fees can be subject to state laws, with some states setting maximum rates, while others have no specific limits.
What to do with auction items that don t sell? ›
Create a Fire Sale with Unsold Items
We have found that auction items that don't sell during your initial auction are because the item did not appeal to your bidders or the price on the item was too high. For these reasons we usually recommend you modify the price of your items and open it up to a wider audience.
What is the most expensive item sold at an auction? ›
Most expensive items sold on auction
- Leonardo Da Vinci's Salvator Mundi: $450 million. ...
- Pablo Picasso's Les Femmes d'Alger (Version O): $179 million. ...
- Frank Mulder's Gigayacht - $168 million. ...
- Elizabeth Taylor's Jewellery Collection: $116 million. ...
- Jeff Koon's Rabbit: $91.1 million. ...
- The Oppenheimer Blue: $57.9 million.
One common strategy for unsold items is to reintroduce them in upcoming auctions. This approach is particularly prevalent in auction houses that conduct regular sales. If an item does not attract sufficient bids in one auction, it might find a more receptive audience at a different time or in a different market.
How do I get the most out of an auction? ›
We recommend setting the starting bid for consignment items at a minimum of 25% over the price the item costs you. Your goal should be to make 150% on each auction item. For live auction items, you need to make sure your auctioneer is aware of how much the item costs you and what your goal bid is for the auction item.
How do I sell expensive items? ›
How to Sell Expensive Products
- Understand your buyer persona.
- Use a high-ticket sales script.
- Help them envision what success looks like.
- Figure out your competition.
- Eliminate low-quality competitors.
- Talk price only after you're in the lead.
- Ask about when low-cost choices let them down.
Here's 6 rules to keep in mind when pricing your items:
- Research the Known Price of Tangible Items.
- Consult with Supporters to Estimate the Value of Intangible Items.
- Set a Minimum Bid at 30-50% of an Auction's FMV.
- Set a Higher Minimum Bid for Unique Auction Items.
- Start by Increasing Bids by 10% of the Item's FMV.
Slow and steady wins the race. As a turtle bidder, you emulate this by starting with a low bid and working your way up slowly. Placing your first bid early gives you time to observe how the auction progresses and make informed decisions about your next steps.
How do auction houses get items? ›
Consignment: Sellers bring their items to the auction house, where they're carefully evaluated and cataloged by experts. Marketing: Auction houses promote upcoming auctions through various channels, including websites, catalogs, and social media, to attract potential buyers.
Are there people who will sell my stuff for me? ›
Let a Trading Assistant do it for you! Trading Assistants are experienced eBay sellers who will sell your items on eBay for a fee. Work with a Trading Assistant and enjoy these benefits: Save time and effort.
