The idea of making a much sought after investment for a much more affordable price is obviously an appealing one, as is getting rid of the items and investments you no longer need in return for money. That’s why auctions are such a popular method for undergoing sales transactions. Once you enjoy your first auction, you’ll wonder why you didn’t take the plunge earlier.
But enjoying an auction isn’t enough. You also need to know how to make a success of it. Buying and selling at auction is a delicate tightrope walk between reward and risk, so you need to be confident that you’re making the most of the opportunity. Here are some of the questions you’ll need to consider before selling or buying at auction.
What if your object is in poor condition?
Whether or not the condition of your objects will dramatically affect the price of the object you’re selling or buying really depends on the object itself. If it possesses a significant level of rarity value, wear and tear will not make too much difference to the price. Most objects of a certain age will commonly show signs of wear and tear, and in fact sometimes this can enhance the overall price when you’re dealing with older objects of value. Many dealers prefer to buy lots in their original condition.
Do you have to sell at any price?
The short answer here is no. If you are selling an object at auction, you can put a reserve on the item. This means that there is a certain price below which is won’t be sold. If you are a buyer, this means you should disregard the possibility that you’ll be able to buy a rare item for pennies because no one is interested.
However, high reserves are often discouraged, as it’s easier for auctioneers to start low.
How much will you have to pay when you sell at auction?
Every saleroom has its own terms and conditions on this matter. However, the general commission for a seller is around 15% plus VAT. There may also be other charges to consider, such as an entry fee and charges for catalogue photographs. To get a more specific idea of how much you’ll be expected to pay, ask how much you would receive if your item sold for its reserve price.
What kind of things can you buy and sell at auction?
There is an auction environment for pretty much every sales transaction, from antiques and heirlooms to electronics and second-hand clothing. Online tools like eBay have brought the auction process to the forefront of selling, and a few minutes on these sites shows just how versatile auctions can be.
You can even buy and sell property at auctions, which can be a great way of finding properties which have evaded the mainstream property market. There is even auction finance available from trusted providers like Glenhawk, and this can give you the vital funds you need to take advantage of a great property investment opportunity.
How much luck is involved when you sell at auction?
Success at an auction does involve a bit of luck. The nature of auctions means that they are never entirely predictable, and this is part of their charm. You can end up in a bidding war, or manage to snag a bargain for close to its reserve. It depends on who is joining you in the crowd on the day.
However, preparing as much as possible can stand you in good stead for auction success. Research the auction house you’re attending and get familiar with their process.