There is a rule of thumb in the Antiques & Collectibles business that the more people who are interested in an item, the more valuable it becomes. And this couldn’t be more true anywhere else than in the Auction business.
It takes a minimum of three people for an Auction to succeed: The Auctioneer, and at least two Bidders … the Winning Bidder and the Under-Bidder. Let’s take as an example a rare coin. Bidder A is willing to pay a maximum of $10,000 for that coin, while Bidder B is only will to pay a maximum of $2000. And in this example, theoretically no one else is interested in paying any more than these two Bidders. Bidder A is willing to pay $10,000 and Bidder B is willing to pay only $2000. What does Bidder A have to pay for that coin? $2000 … plus one more bid. So even though Bidder A is willing to pay $10,000, he will win it for approximately $2,100. Because there was no one else interested enough to push him any higher.
Let’s take a slightly different scenario. The same coin, the same Auctioneer, the same day. But with more bidder interest in that coin. Bidder A is willing to pay $10,000; Bidder B is willing to pay $2,000 …and now there is another interested Bidder C … who is willing to pay $9,000 for that coin. Bidder A is willing to pay $10,000, and now Bidder C is willing to pay $9000. What does Bidder A have to pay in this scenario? $9000 … plus one bid, or perhaps $9100.
This example illustrates the Power of Competitive Bidding at Auctions. The better the merchandise, the higher the level of bidder interest, the higher the final sale price.
This contrasts to items having little market interest. Common items, outdated items, items having condition issues, etc. will rarely generate strong auction prices
WHAT’S IT WORTH: Not all that long ago my wife and I attended a local Auction where we fell in love with a petite reproduction country corner cupboard. We had a perfect place for it in our home. ”$100-$150” is what I predicted we would pay it for. After all, it was a contemporary reproduction. The next thing I knew we paid $600 for an item I felt was worth $100-$150. What happened? We ran up against an equally motivated 2nd bidder who wanted it as much as we did. If she wasn’t there, or if we weren’t there, one of us probably would have won it at around $100-$150
Mike Ivankovich is an Auctioneer, Appraiser, Home Downsizing Expert, and host of the “What’s It Worth? Ask Mike the Appraiser” Radio Show. Now in its 6th year, “What’s It Worth” airs live in the Philadelphia PA area on Friday mornings from 9:30-10:30 AM EST on WBCB 1490 AM, and on the Internet at: www.WBCB1490.com. You can also visit his Radio Show Web Site: www.AskMikeTheAppraiser.com. If your local station doesn’t carry “What’s It Worth” tell them they need to add it to their programing mix. If you know anyone who needs any Personal Property Appraisal work, or if you need a Speaker for an upcoming meeting or event, call Mike at (215)-264-4304, or visit: www.michaelivankovichMEETINGSPEAKER.com