It’s true that billionaires bid at live auctions, sometimes spending nine — yes, nine — figures. The most expensive item sold at auction to date was Edvard Munch’s “The Scream,” which went for $119.9 million at Sotheby’s New York. Auctions, however, aren't just for tycoons; everyday folks can get some deals too, just by following a few simple pointers.
Do Your Research
You can overbid at live auctions, especially if you're caught up in a bidding war. But if you come prepared and know what you’re doing, you can do quite well, said Edward Wilkinson, a Los Angeles auctioneer, in CNNMoney. Study the items to be sold before attending the auction. You can get this information from the auction house’s website, or the auction house can send you a catalog that lists the items for sale. It's a good idea to attend an auction and observe without bidding to see how the process works.
Decide Your Price
Decide before you go to the auction what your top bid will be, and don't exceed it. Include in this figure sales tax and a 20 percent markup, which typically goes to the auction house. Don’t appear too interested or eager to buy the lot — the item or groups of items being bid on — even if you are. Ed Beardsley, an auctioneer for Bonhams & Butterfields, said that auctioneers can tell how interested you are by your body language and by the interest you show in an item. Play it cool, and wait until the bidding winds down to make your bid.
Arriving early to the auction lets you preview items and ask questions. You can't do that after the auction starts. If you ask the auctioneer a question and he doesn't give you a straight answer, don't buy the item, advised licensed auctioneer Wayne Jordan on his website. In addition, the terms and conditions of the auction are explained during the first several minutes; if you arrive late, you could miss important information.
Don't Be Fooled
Understand certain tricks used at some actions so you won’t be fooled. Don Lancaster, an author who writes about bargains, called this practice “crookedosity.” Some auctions use a shill, a friend of the auctioneer’s who bids against you only to raise the price. Shills, according to Lancaster, typically display manic behavior. A variation of the shill occurs when the auctioneer calls out a nonexistent bid by pretending someone in the audience actually made one. If no one bids higher, the auctioneer might say that he was mistaken — that he thought he saw someone bid. Another trick happens when the auctioneer charges you more than what you bid. Check to ensure that the price the auctioneer accepted really was your final bid.
- Does Our Neighbor's Foreclosure Affect Our House's Value?
- Negotiating Tips for Buying a New Car
- How to Purchase an Affordable Car
- What Does a Reserve Price Mean at a Home Auction?
- How to Find the Value of Antique or Vintage Items
- How to Make an Offer on a Home Without Insulting the Seller
- How to Buy a Tax Lien Home
- Strategy for Negotiating for a New Car