Live Auction Houses - What You Need to Know Before Attending

Have you ever watched the television shows featuring live auction houses? They are entertaining and make live auction houses appear to be fun and profitable. In reality, what happens is sometimes different than what's portrayed by television.

Legal aspects governing live auction houses:

Although there are legal statutes governing the operation of an auction, fraud is sometimes conducted. Each state has rules governing live auction houses and most counties and cities. If you are considering a live auction, check the legal statues governing your state, county and city. As a seller, know what the rules are before entering in a contractual agreement with a live auction house, auctioneers, or an auction company. Auctioneers should post rules of the house in a conspicuous place to be read by the public. (i.e. Cashier's Booth) As a general rule, it is illegal for a house to sell to its own family members, employees or sell to "ghost" bidders or "shills". An auction house may not misrepresent items for sell. Fraud charges can be brought or "word of mouth" is recourse, along with reporting to the Chamber of Commerce and Better Business Bureau.

The Auctioneer controls the auction:

The auction is controlled by the auctioneer and the general public is expecting honesty, integrity and leadership. You may get much less at some live auction houses. A reputable auctioneer will be available prior to the start of the auction to answer questions from the public. She/he should make an opening statement covering the bidding rules of etiquette or conduct that is expected from the bidders. The bidder must understand that the auctioneer has the final authority on all matters. The auctioneer works for the seller to get the best price for an item, but may not practice deception to achieve that goal.

Preparation for live auction houses:

The best way for a Buyer/Seller to learn about auctions, auction rules and auction etiquette is to attend regularly. Whatever items you are interested in buying or selling, you can locate a house that handles the merchandise. Do the necessary research to be aware of the value of what you are interested in selling or buying. Watch the proceedings closely.

If selling with a live auction house, make a detailed and descriptive list of all items you have in the sale. Note any minimums you desire. Give the house a copy and ask them to sign a receipt (your copy) of the items. Prepare to attend and write down your items sold and the amount. Stay for the entire auction!

Bad experiences in live auction houses:

A friend of mine recently had a very bad experience with a live auction house in Haskell, Oklahoma. She had antique furniture, valuable collectibles and paintings to sell. The auctioneer assured her the sale was a big Victorian Antique Furniture auction and her items were to be advertised on-line. They would also pick up the items for her. She and a friend attended to find the sale had been totally misrepresented. Most of the sale time was given to selling rugs! A French Mantle Clock (the first repair date etched inside as 1872) was presented as a pretty little marble clock. This is only one example. Antiques were not stated as antiques, were sold at flea market prices and minimums were completely ignored.

The auction house kept almost no records and the following month some of her items were again displayed for sale. The house did allow her to pick up the items she located as hers and she is still trying to sort out what they sold and for how much. What a mess! She did her checking and asked the appropriate questions and was mislead.

Conclusion:

There are reputable live auction houses available that do not misrepresent their sales or themselves. Items being sold are shown individually from a stage view. The house keeps thorough and accurate records, honors minimums and gives the sellers complete listings of items sold, with the amount and to whom.

On-line auctions have changed the face of live auction houses. Bidders are looking for cheap prices to resell and auctioneers tend to "play favorites". Do your homework, check all references and attend the auctions. Knowledge and experience is your best protection against fraud.