Monday, August 16, 2010

My tips for bidding at auction

If you've never bought anything at auction before, it can seem a little scary, but it shouldn't. I don't always 'win' my bids, but here are some things I've learned along the way.

Auctions are fun!

There is no better way to get over the auction jitters than to attend an auction or two to get the feel of it. You will see how people bid, and the dynamic in the room. Every auction will be a little bit different, but it helps to see how it works.

Auction Estimates and the Buyer's Premium

The auction house places estimate ranges on all the lots. They often have a reserve set which will be unstated (a price below which they will not sell the item), so look for the note that an item is 'without reserve" which is an opportunity for bargains!

If you look at auction results you will see that items can go for well below or well above the estimate range, so my own personal rule is to try to 'ignore' the estimate, and bid what I think is the price I'm willing to pay. I've missed out on some bargains by paying too much attention to the estimate, only to find that the lot went for well below. Here is an example!

These Gae Aulenti chairs sold at a Wright Auction for $281! They had an auction estimate of $2,000 - $3,000.

On the other hand this Isamu Noguchi for Herman Miller table sold at a Stair Galleries auction
for pretty much the retail price at $1,600, which we knew because we had checked it out on line before bidding. The estimate was $500 - $700.

Always remember that there is a buyer's premium which is a percentage applied above the bid price. These are often in the range of 15% - 17.5%.

Research and preparation

The more research you can do to prepare yourself to make a bid the better. That way you can set a price target that is something you're comfortable with, and not more. It requires real discipline, but you won't find that you overpaid for something later.

As an example, I planned to buy a desk at auction, so my first step was to go to a number of retail stores to find desks I liked and price them. I used these prices to set my top price for what I would pay at auction.You've seen my desk before if you follow my blog, but here it is again, and I love it. I got it for $1,750 at Doyle New York.

Bidding at auction in person

Attending the auction in person is the best way to bid if you can do it. I don't shy away from absentee bids, but I have also missed out on items that I might have bid on opportunistically if I'd been at the auction.

1) Prepare your list of auction lots you want to bid on, and set your top price. This is important because the bidding can move very fast, and you don't necessarily want to be swept up in a frenzy and then wonder what your did when it comes time to pay!

2) When your lot comes up, sit back for a bit and let others bids before you.  If there isn't much interest, the price may be dropped by the auctioneer, so you wouldn't want to miss that. Jump in as the bidding slows down, but stop when you hit your top price.

We found at a Stair Galleries auction that everything we wanted to bid on went for more than our top limits. However, we ended up buying a dining table for $325 that we hadn't planned to bid on, but it was such a bargain that we jumped in. We're happy we did. 

Absentee Bidding

Sometimes you can't attend the auction, or don't want to! We have often bid absentee because we didn't want to subject ourselves to the auction frenzy and the potential disappointment! Instead just wait for the call for a winning bid after the auction is over.

Auction houses are happy to take absentee bids. Some have on-line bidding now too. You just fill out the form and put in your top bid. You will get it for less if that's the way the bidding went at the auction itself. We have often won things for less that the absentee bid we put in. It's a safe way to go.

You can always check the sales results afterwards to see what the items went for.

Telephone bidding

Most auctions will take telephone bids. You have to arrange this ahead of time with the auction house, and tell them which lots you want to bid on. They will call you and you can then bid 'live'. If you really want something, this is a good alternative to being there in person. I did this once on a writing desk at New Orleans Auction, and it was successful.

Auction previews or not!

Obviously the best way to buy anything is to see it in person. I have often seen something on line that in person doesn't quite look the same or the condition is worse than I thought. Or maybe the seat cushion is a bit saggy, and would need a repair.

That said, I've bought things just based on the on-line catalogue. I would never buy a painting, but I have bought furniture. I would recommend asking for a condition report from the auction house, or even calling and talking to someone about it. People buy lots of things on-line, why not furniture at auction.

The one thing to research ahead before buying from an auction house that's not in your town is the shipping cost. The auction house can help with that too.

1 comment:

  1. Good post! Thanks for sharing this information I appreciate it. God bless!

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