28 July 2010

Auction advice for the seasoned pro

So you’ve finally made the decision, and you’re going to go for it. Your dog-eared auction catalog has been your constant companion for the last three weeks. When you run into anyone you know, you’ve pulled it out to give them a look at your next true love. You’ve agonized over the estimate in the catalog; is it deliberately low, to encourage bidding? Or why is it so much higher than the price of any other example you’ve ever seen? Is it good for me that it’s so early/so late in the auction? How can I get inside information on what the car is really like?

All these questions and more have and will run through your mind as the sale approaches and you prepare to enter the auction arena. Even the most seasoned auction-goer should keep a few things in mind when hitting up the Monterey sales.

Knowledge is power. If there is a description of the car in the auction catalog, read it carefully. Make a list of any points that aren’t mentioned, such as ownership history and any recent work performed. These details may not have been available at catalog deadline, and while you may think you can’t inspect a car the way you might in a private transaction or at a dealer’s showroom, there are several opportunities of which you should take advantage.

Take a close look. A few weeks before the sale, contact the auction company to find out when the car will be arriving on site. Often you can arrange to see the car before the auction preview opens; and sometimes you can even take a ride with an auction company specialist. At the very least, ask for a “condition report.” This no-cost service gives you a description of the car by a staff specialist who did not consign the vehicle, describing its visual condition and any driving impressions they may have had. Better yet, hire a professional appraiser or mechanic to look it over.

During the on-site preview, small, removable items such as lighters, ash trays and tool kits are removed from cars to prevent theft. Ask what has been removed from the car and ask to see it, along with any documentation they may have.

Get ready to bid. Now that your inspection is complete, it’s time to work on bidding strategies. Some like to hold back and wait until bidding stalls before jumping in at the last minute to snare their prize. Others want to be the first to raise their paddle, to declare their intentions. Both techniques have advantages, but either way, be sure to let the specialists or ring men know you have an interest in a car. Auctioneers only deal with two bidders at once; if you can’t get their attention, you may be overlooked and miss the car.

Buyer beware. It may seem an obvious point, but be sure to remember the buyer’s premium, which in Monterey can vary from 6 percent to 17 percent of the price at “the hammer.” Your maximum price must include this or you’ll risk unpleasant surprises later. The estimates in the auction catalog are intended to be the hammer price, not the final price with the buyer’s commission.

Listen carefully. By law in many jurisdictions, and by auction company policy in all cases, any reserve price cannot be higher than a declared or printed low estimate. Just how close those numbers are is confidential, but the savvy bidder knows to listen for signs that it’s being approached. The bidding increments may suddenly become much smaller as the auctioneer looks to close what may be a very small gap. Decide on your top number and stick to it. It’s easy to be seduced by the calls of “just one more bid,” but that can lead to some severe buyer’s remorse.

Do your homework, prepare your strategy and stay cool – you’ll be in the driver’s seat. And one other thing: it’s probably best to wait until after you’ve made your purchase to go to the bidder’s bar for your celebratory drink.

 

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