Auctions 06 Aug 2008 06:20 am
Recently I have noticed several advertisements for an Estate (Yard) sale. In fact, my wife just recently attended one here in the area. People were their by the droves she said, and they had hired a company to come help manage the sale and price the items. This brought to mind a question for me in regards to the Pro’s and Con’s of both methods of settling an estate. Me, being an Auctioneer, of course I have a slight bias toward one over the other, but once you write down the comparisons, it starts to make sense.
1. At the Estate Sale, you get to control the price on each item sold. At Auction the price is set by the competing bidders! One could consider this a Pro for the Estate Sale, and in some cases it very well is a Pro. Being able to set your price and negotiate on your terms is a huge plus. But, at Auction, many times a competition for a piece can actually drive a price beyond what you were thinking. This is an upside in an auction. To be fair, I think it also necessary to mention that at auction, many times a “particular” item for which you expected a certain price will bring below its value, but this is often offset by many other items which you thought had very little value bringing more than you imagined, thus offering a balance to the scale. The Pro’s and Con’s balance here!
2. At Auction, everything is sold in one day! This is a point I make to anyone weighing their options. I cannot recall the number of times I have been asked, “What will we do with what is left, or, With won’t sell?” My response is usually the same, ” When we are done, you might start to wonder if we are going to leave the house intact!” This is a great benefit to an Estate Auction in that everything is sold in one setting. Many times at an Estate Sale, at the end of the weekend, you are slashing prices in hopes someone will take everything off your hands, and what you have left you are left wondering what to do with it. This of course is after you have been “cherry picked” on all your good items. To me this defeats the purpose of “setting your own price” (see #1) because you end up cutting them as your time winds down. Pro for the Auction!
3. Advertising cost! I know this plays big in the minds of people when it comes to an Estate settlement. And the truth is, it is MUCH cheaper to run advertising for an Estate Sale than it is an Auction. That would be very difficult to cover up. Pro for the Estate Sale.
4. Attracting the right crowd! This plays into the previous paragraph. When you are handling an Estate, it is imperative that you attract the proper crowd in order to obtain the prices you are hoping to receive for your items and property. With the advertising for an Estate Sale in the local newspaper section for Yard Sales, you are going to attract the “Yard Saler’s” as my wife likes to cal herself! And with this crowd, you will have your bargain hunters and trained negotiators! When you allow an Auctioneer to properly advertise your Estate Auction (yes it will cost more), he/she is able to focus your advertising toward to the “crowd” who will be most interested in your items and property. You will have a broad coverage for those same people mentioned above, but you will also get direct coverage to those who have an interest in your specialty items (farm equipment, Antiques, Firearms, Unique Collections, etc…). This means by spending more to attract the right crowd of buyers, you increase your opportunity to obtain a higher price for your merchandise and more competitors bidding for the same items! Pro to the Auction.
1. Real Estate and Personal Property. At an estate sale, many times you will have a home, farm, and personal property to offer. And, many times, people attempt to offer both in the same day by employing the Estate Sale method. I do not have a percentage on hand, but by all experience I have had, rarely can you sell the property for what you think it is worth, and you are sure to gather in offers from folks trying to “get a GREAT deal.” At Auction, this is true as well, but your investors that make the auction circuit are seasoned investors who know their values and have years of experience dealing with auctioneers. On the flip side, you also have a seasoned Auctioneer who is well aware of your market value on your home or farm, and they have been striving to bring in the “Using Bidder” to bid against your investor. This is the recipe for having a great sale, and not having to wait for the property to make it through the Private Treaty rounds while it competes with an over filled market in these down times. Pro for the Auction.
There are many more arguments that could be made for both sides, and I think you should choose the path you are more inclined to walk. Both have their ups and their downs, but when placed in the scales, and balanced with the emotions involved, I think an Auction is a great value for your money.
I would love to hear your opinions on the matter! What are your thoughts, reasonings, and opinions?