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Some Frequently Asked Questions Regarding Auctions

What is an auction?

An auction is a method of marketing where the items sell to the highest bidders.  Anyone in the crowd who is willing to pay the most will walk away  with the merchandise. Auctioneers market their sales to draw the most buyers so that items will sell for top dollar.

Why do people sell at auctions?

Sellers  choose the auction method of marketing because, through competition  among bidders, the items sell at or above current market value. There would be no reason for people to sell at auction if their property always sold for rock-bottom prices.

Does anyone get bargains at auctions?

Yes, but remember: a bargain is in the eye of the beholder.  If you see an item you want and are able to buy it for the price  you were willing to pay for it, then it's a bargain for you. But a bargain for one may not be a bargain for another. For example, you may not see any value in a doll that is for sale at an auction.  However, if the person standing next to you is a doll collector  and is thrilled to make the winning bid of $3,000, he got a bargain.

If I can't get rock-bottom  bargain prices, why should I buy at auctions?

At an auction, consumers are assured of buying at the fair market value, because  not only do they have a say in setting the price, they can get the items they want for just one bid over the next interested party. Additionally, auctions offer a wide selection of merchandise, including many valuable or unique, one-of-a-kind items not available elsewhere.

How can I find out about buying a specific type of merchandise at auctions?

From real estate to  restaurant equipment, from antiques to agriculture, auctioneers  maintain mailing lists for many various specialties. Contact auction companies and ask to be put on the mailing list for the specialty  you're interested in.

What can I do if I'm confused or intimidated about buying at auctions? 

Follow these guidelines  to become a confident auction consumer: Attend a free educational seminar on auctions. Many auctioneers conduct seminars which instruct  auction newcomers on various auction terms, how to buy at auction,  and what to expect at auctions. Attend auctions and watch how different  auctioneers run their sales. Do your homework. For example, if you are interested in buying a specific type of merchandise, such as office equipment, research how much desks and chairs are sold for  in retail and wholesale outlets. Go to the library and refer to price and value guides for different brands and types of office  furniture. Ask the auctioneer for information about the merchandise she is selling that you're interested in. Then set a price you are  willing to pay. Most auctioneers schedule a preview prior to the  auction. Attend the preview and carefully inspect the merchandise  that you are interested in, adjusting the price you have set, if  necessary, according to your inspection. Arrive at the auction early  and get a seat near the front where you can see the merchandise  as it is sold, and where the auctioneer can see you when you bid. Introduce yourself to the auctioneer, ask her how she runs her auctions, when the item you want will be up for sale, and about her terms  (such as whether you need to arrange for transporting the items you bought that day, whether a buyer's premium and/or tax applies,  if checks are accepted, etc.). Tell the auctioneer which item you are interested in buying, and ask him to help you buy it. When the item you want comes up for sale, bid early so the auctioneer will see you and you won't risk being overlooked. Don't be intimidated  by other bidders (sometimes others will try scare tactics, such as glaring at you, to get you to stop bidding on the items they want). Stick to the price you set, and don't bid more than you intended  to. Keep track of each item you buy, including a brief description,  the lot number, and the price you paid. Remember to calculate the  buyer's premium and taxes, if applicable, so you won't be surprised at the cashier's table.

What types of claims about auctions should make me raise a red flag? 

Many advertisements, catalogs and seminars promise easy "get rich quick" schemes  through buying at auctions. They may ask you to buy catalogs, auction listings, or videotapes to learn where auctions are, how to buy  at auctions, and to be put on auction companies' mailing lists. Remember, you don't have to spend money to become a savvy auction  consumer. The information these sources want to charge you for can  be found for little or no cost in your local newspaper, at the library,  or from professional auctioneers. Also, beware of claims that houses,  cars, and other property are available at auctions for "pennies on the dollar." Find out the rest of the story. What condition  are the items in? Would they really be a bargain? Are there back  taxes, repair bills, etc. to be paid?

Remembering the facts about auctions will help you be a smart auction  consumer who avoids spending time and money on empty promises about "get rich quick" schemes.

Auctions are not a way to "get rich quick." But look at what auctions are: Auctions offer a variety of interesting, unique  and valuable merchandise. Auctions allow consumers to set the price.  Auctions ensure that the price you pay is the fair market value. And auctions enable you to find and buy your bargains.

Bidding at an Auction can be a fun and rewarding experience. We  focus on making your auction experience as pleasant and easy as possible.

Copyright National Auctioneers Association

If you have any interesting stories or tips about buying or selling at live auctions please e-mail us at CBHcontact@gmail.com.