A Bidder's Guideline to Auctions

This is a compilation of helpful tricks that could improve your bidding power.



How not to overbid.



Overbidding is a common problem among people participating at auctions. In sealed and silent bidding, it is easy to overbid since nobody else knows exactly how high or low the bids are. To ensure that someone wins the bids, he should give it his highest estimated value. On the other hand, the behavior of the crowd and the excitement encouraged by the auctioneer over the properties or items are enough to make people bid excessively. The easiest way to counter this is to do your research.



How to establish your price limit.



Realistic price limits could be made through critically listening to people's advice, from searching the same items online and through researching some information regarding the property or the item being auctioned. With enough information, you could come up with an estimated value of the merchandise. You don't have to be an auction guru to know how much an item is worth though.



It all boils down to research. Knowing something about the item could help you decide on how much you should be willing to bid on it. Doing your homework, getting hold of the actual auction catalogue or inspecting the items during their viewing period could help a lot not only on deciding which item to get but also the price limit you give to each item.



Maximize your time.



Some auctions will give you sufficient time to inspect the item, some provide the catalogues. Whichever method is being used in the auction you are interested in, you should try to maximize your time by coming in the auction site early. By doing so you might get a chance to talk to the auction organizers and inquire about the items. This also gives you the advantage of getting a comfortable seat.



Attend some auctions beforehand.



People who are serious about auctions try to find as much information about them as they can. One good way is to witness live auctions personally. There is so much going on, the hype, the excitement and the wars that normally happen. All these could give you reliable information once you decide to participate yourself. Initially, you should not place any bid- no matter how small the amount. Your intention is to get the feel of the auction process, nothing else.



Observe the crowd.



Bidders have different personalities- each of which work for their buying styles. Work out the differences and similarities among bidders and develop a style of your own. Take note of the style of the more successful ones.

Advantages of Auctions for the Buyers

Why is there such hype regarding auctions? What's so good about them and what do people get from them that they don't normally get from other forms of buying?



Half of Americans, according to the study conducted by the National Auctioneers Association, have seen or attended an auction. This means that auctions are fairly popular among Americans and that the majority of people often prefer to trade through auctions, like in EBay and other live auctions rather than in the actual market. Why? Because first, it is one of the most exciting ways to get the best deals (according to the 83% of all the people surveyed), second, great value for items is often offered to the buyers (this according to more than half of the respondents), and third, buyers are satisfied with the prices they pay at the auctions. Apart from these reasons, there are several others including the following:



Speed of Buying



Most types of auctions are timed so the buyers are pressured to bid their price before the time runs out. This alone gives the excitement for both observers and bidders. Also, buying at an auction offers a fast transaction. Its core rule: give the highest bid and you win the item.



Chance for the buyer to establish his own price



While items at auction usually have reserve prices, auctions still let the bidders decide the highest and lowest value of the items. Thus, the control for pricing is given to the bidders and the real market value of the merchandise is evaluated.



Getting the fair market value



Fair market value comes from the transactions between a willing buyer and a willing seller. In the structure of auction, it is obvious that people participating in it, the sellers and the buyers, get the fair market value of the property or the item they are buying.



Guaranteed sale for both the buyer and the seller



Bidders come to auction with the intent of buying an item and sellers go to auctions to make money off their property. Thus, both parties have the assurance that they will have their intentions satisfied. So it is rare, if not impossible, to have cases where any of the two individuals back out from the transaction since an agreement at auction is legally binding.



It eliminates tedious negotiations



Auctions do not need negotiations between buyers and sellers. If the bidder wins the highest bid, he gets the item whether the seller agrees to the price or not.

A Quick Guide in Hosting a Fundraising Auction

Any successful event needs careful planning. If you are hosting a fundraising auction, you should sit down, talk with your team, and plan for the event.



Gather the Auction Goods.

Items that will be put on sale may not be expensive and of the same kind. They can be things like handicrafts, trips, commemorative items, sports or concert tickets, and gift certificates among others.



Set the stage.

A fundraising auction can be mixed with other event such as Sunday garden cookout, or spaghetti a dinner, or wine and cheese party. Prepare everything from food, chairs, tables, bid numbers, and stage. Your venue should be ideal to the event. If you are holding it indoors, decorations are essential. If you are holding it outdoors, check the weather forecast. Have a backup plan in case something goes wrong. The last thing you would want is for the event to be suspended due to weather or any avoidable disaster. Nonetheless, as long as you have a good venue and people ready to shed some money for a good cause, you'll be fine.



Let it be Known.

Have the invitation set. The people that will attend the auction are the people you will expect to bid the give away money without any hesitations. So when inviting people, it is important to talk to them personally and explain what the auction is all about, its goals and mission. Understanding that the proceeds of the auction will go to a good cause will increase the possibility of getting higher bids. Do not forget to print out invitations and auction brochures or catalogues to be given away to the invited people before the bidding starts.



Get a Good Auctioneer.

One secret to a successful fundraising auction is to have a lively auctioneer. He or she may not be a professional or a fast talker; a good auctioneer has to be someone who can stand on the podium and get the crowd going. Because an enthused crowd may buy anything, even the most unlovable object will be sold for a considerable amount. Get it from your group member who has the talent and skill to connect with anyone.



Hosting an action is one of the most effective ways to raise money for a good cause. If you are tasked to prepare for one, use this as a guide to make sure that the auction is a success.

Auction Guide for First Time Bidders

When you are going to an auction for the first time, there are specific things that you should know.



1. Obtain an auction brochure or catalogue. Do this at least a day before the auction date. This ensures that the goods for sale are what you need.



2. From the auction catalogue, identify what you want. If it's a car, do your research on its current market value online. Once you know its value on the market, you can set your budget.



3. At the day of the sale, phone in the auction house and confirm if the auction is going as scheduled as certain auctions can be subjected to last minute cancellations or rescheduling. Phoning in to confirm if the property or an item you are interested in is still on sale is something you should do before going to the auction house as well.



4. Once you arrive at the auction house, register to obtain a bidding number. You will be asked for your name, address, and contact number and will be asked to pay a deposit or pay a certain amount for the registration fee.



5. Come early. This allows you to inspect the auction goods properly before the bidding starts. An auction brochure may be helpful in providing information of the goods for sale; but physically inspecting the items before the sale allows you to determine if the goods are really worth any amount of your money. Do an ocular inspection, days before the scheduled auction if it is a piece of property.



6. Each item is designated with a lot number for easy reference. Take note of these numbers when you are inspecting the goods. The same number will be called during the actual auction.



7. Before the auction starts, the auctioneer will explain the rules. Listen attentively and keep your ears open for additional information on the goods up for bid.



8. Once the auctioneer calls for the starting bid, the bidding process begins. Each item may be sold within seconds. Once the lot number you are interested in is called, be alert and stay focus. Do not bid an amount you cannot afford. Stay within your set budget. Most first time bidders get carried away and bid higher than what they have originally planned.



9. If you have won an item, you will be asked to pay in partial or in full and to give your personal details the day of the auction.



Once it is all settled, you will be asked to sign an auction memorandum. The deal is done!

Auction: How Does It Work

Auction is not like buying something from the department store- you get it, grab the item, go to the cashier and pay for it then get out of the store with the item at hand. In auctions, there is fierce competition especially during bidding wars. There are only few items being auctioned which means that only a few people can win the bid so in most cases, even if the bidder comes well-prepared for the battle, he could still get out of the auction site with nothing in hand.



So how does auction work?



Registration



It is a must for auctioneers to have their potential bidders register before they participate in the bidding. The bidder has to give the correct information as this may be use as reference for future transactions. Typical information required are personal information such as name, address and bidding history if applicable. Also during registration, the participant will be asked to pay a returnable deposit. Some auctioneers require large deposits, thus anyone who wants to participate in an auction should be well-equipped with knowledge on the particular type of auction.



Afterwards, the bidder will be given a bidding number which is often used to substitute for the name of the bidder as the bidding happens.



Bidding proper



Each bidder should be given a catalogue which is a list that contains details regarding the items being auctioned. (NOTE: Under normal circumstances, viewing time is allowed which could last anywhere from a few hours to several days. This allows the potential buyer to view the items he wants to bid on before the auction begins. For some auctions that provide catalogues though, viewing is not allowed. To be sure, it is best to confirm details regarding viewing time and catalogues before the date of the auction.)



After this, the auctioneer will announce the item being auctioned and some important details regarding the item which is usually tied with the information given on the catalog. The auctioneer will then suggest a starting bid- this is not necessarily the lowest available price for the item. In most cases, the first bid usually begins at a price below the starting bid. On the other hand, if the item has a set reserve price, the bidding will usually start above this price until it reaches the reserve price. For guiding the bidders, the catalogues usually have guide prices.



After the announcement of the starting price, the bidders are free to outbid each other until the highest bid is reached. Bidders typically get the attention of the auctioneer by raising their hands or their bidding numbers. But clear gestures can also be used. The auctioneer will normally return to the most active bidders for confirmation of bids. If the bidder wishes to withdraw from the bidding, he can shake his head. The one with the highest bid will win the item.



After the bidding, the final bidder will pay a deposit according to the terms and conditions of the purchase. Payment methods are normally stated in the auction catalogue.

Auctions: How to Bid Safely

Every movement on the bidding floor- even the slightest nod- could mean a bid to the auctioneer. Some people accidentally win items being auctioned because of some gestures that were natural for them, say waving at a friend during the auction. This could happen to anyone and it could happen to you.



Here are some bidding safety tips:



EYE CONTACT



You may be sitting far from the auctioneer but whenever you have the chance, catch his attention. Maintain eye contact afterwards. Keep your eye contact whenever possible, this will establish your identity to him. Thus, when it is time for you to bid on an item you intend to buy, you will have no problem in communicating this to the auctioneer.



ESTABLISHING CONNECTION



Once you start bidding see to it that you don't lose the connection with the auctioneer. You could start by making a determined hand gesture or unabashed bidding using your card. From this point on, he will come back to you whenever your bid is upped. A simple nod or a slight gesture will tell him that you willing to raise the price a bit higher.



DROPPING OUT



Sometimes people feel pressured if the auctioneer keeps on coming back to them. If you want to quit from the bidding, a polite shaking of the head will signal the auctioneer that you are backing out.



ENTERING THE BID



You should always know when to enter the bidding. Some people come in too early, some are too late. Both positions have low chances of getting the item or property being auctioned at a price they want. If you want to set the price, try to enter midway into the bidding. This way you are giving yourself a fair chance of getting out of the bid if you want to quit or pursue your bid if you are serious with the item. If you are doubtful on whether or not you should buy the item, never enter the bid when you feel that there are fewer people participating on it.



If, however, you intentionally entered the bidding game late, there is a chance that you could be overlooked by the auctioneer. If this happens, try to get his attention by politely saying a word to signal your interest.



QUICK DECISIONS



Bidding often happen fast and sometimes it leaves you no room for analyzing whether you should place the next highest bid. In this case, try to think as fast as you can because the bidding will never stop for you.

Auctions: Where to Find the Best Deal?

If you are looking for your next car, real estate, clothes, jewelry, arts and antiques, household furniture, personal gadgets or anything you want to buy at bargain prices, you should be heading to any of the following places



Police Auctions.



Police confiscate items and impounds vehicles. But if the items are left unclaimed for a definite period of time or there is no possible way to trace the owners and return the items, they become auction goods. Police also seize properties and items associated to crimes people commit. The police seized properties will then go to an auction. Police auctions are often held at local police agencies, federal law enforcement agencies, police departments, and county sheriff departments at specific time and date.



Government-Seized Auctions. Due to foreclosure and seizure laws, the government accumulates properties from private owners who were unable to pay their mortgages or loans. These will then become government property and will be put into auctions. The Customs and Border Protection, US Department of Homeland Security, U.S. Postal Service, U.S. Marshals Service, U.S. Bankruptcy Court, Internal Revenue Service, and State Tax Department are some of the government agencies that hold government-seized property auctions.



Bank and Loan Companies. Bank and loan companies often repossess properties from owners who are unable to make loan payments. These repossessed properties range from real estate, vehicles to home furniture, become bank or loan company properties. Since the cost of storage is high, bank and loan companies want to convert the repossessed properties into liquid assets right away. The best way to do it is through an auction. Bank and loan companies often announce auction schedules online, in office bulletins and in newspapers.



New and Used Car Dealers. In order to make a sale, new car dealers allow their costumers to trade-in their old cars for new ones. The old vehicle that was traded-in will then go to an auction. Used car dealers also employ the same system as other auction houses to generate sales. While there are some used vehicles up for bidding, there are also very well-maintained vehicles you can buy at a price that is usually lower than their current market value.



Auction Companies. Auction companies sell a wide array of auction goods. Check newspaper ads, auction brochures, and the yellow pages. They often hold valuable information on when and where the next auction will be.