Auction Terms – Rivington Crown Antiques

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Auctioneer Terms

Find the definition of terms in the Auction World.

Absentee Bid

A method of bidding for those who cannot or do not wish to attend an auction.

Appraisal

A formal evaluation of the fair market and/or insurance value of a given property.

As Is

Almost all property for sale at auction is offered “as is,” meaning that the property is sold with all existing faults and imperfections.

Auctioneer

The person whom the seller engages to direct, conduct, or be responsible for a sale by auction. This person may or may not actually call or cry the auction.

Bid

A prospective buyer’s indication or offer of a price he or she will pay to purchase property at auction. Bids are usually in standardized increments established by the auctioneer.

Bid Increment

The amount by which the auctioneer increases the bidding. In general, the auctioneer will request bids of about 10% higher than the previous bid. The figure is generally rounded up or down at the auctioneer's discretion.

Bought-In

If there are no bids on a lot, or if bidding does not reach the reserve price, the lot is “bought in,” meaning it is left unsold and remains the property of the owner.

Buyer’s Premium

The amount above the hammer price that is paid as part of the total purchase price.

Cataloguing

Factual information about a lot offered for sale, such as the name of the artist or maker, a detailed description of the object, the year of its creation, its provenance (history of its ownership), major exhibitions in which it has appeared and publications in which it has been documented.

Consignor

The owner who is transferring property to an auction house to act as agent on his or her behalf for sale.

Designation

The consignor of a lot is sometimes identified through a designation line, which appears at the beginning of a catalogue entry. The designation, which appears at the discretion of the consignor, may identify the current owner by name or through a descriptive title, such as “Property of a Distinguished European Collector.”

Estimate

Each lot is given a low and high estimate, representing the opinion of experts about the range in which the lot might sell at auction. Estimates are based on the examination of an item and recent auction records of comparable pieces. Published in online and printed catalogues, an estimate provides prospective buyers with an important preliminary guide to value and is generally the basis for establishing the reserve price.

Fair Market Value

A term frequently used by appraisers referring to their judgment and opinion about an object’s likely sale price if offered by a willing seller to a willing buyer. Since the auction process is open to all bidders, a sale at auction is considered to be a measure of Fair Market Value.

Fair Warning

A warning sometimes given by the auctioneer that the hammer is about to come down on a lot. The fair warning offers one last chance to increase the bidding. If there are no subsequent bids, the auctioneer’s hammer falls and the sale is completed.

Gavel

Another name for the auctioneer’s hammer used to close the bidding.

Guarantee

In rare cases, an auction house will guarantee to pay a consignor for a lot, regardless of whether the bidding at auction reaches the reserve price. The guarantee may be provided by the auction house, by a third party or jointly by the auction and a third party. Third parties providing all or part of a guarantee benefit financially if a guaranteed lot is sold successfully and may incur a loss if the sale is not successful.

Hammer Price

The winning bid for a lot at auction. It is the price upon which the auctioneer’s hammer falls, determining the sale price, but does not include the buyer's premium.

Knocked Down

An auction house term for the hammer coming down and ending the bidding, as in, “The lot was knocked down at $1 million.”

Lot

An individual object or group of objects offered for sale at auction as a single unit.

Minimum Opening Bid

The lowest acceptable amount at which the bidding must commence.

On-Line Auction

An auction conducted at the premises of the property being sold and broadcasted on-line.

Paddle

An object displaying the number assigned to a bidder when he or she registers at the auction. To place a bid, simply raise your paddle until the auctioneer acknowledges you. If you win the auction, your paddle number is recorded alongside your bid. To pay for your purchase, you will need to bring your paddle to the Payments counter.

Provenance

An important part of the authentication process, provenance establishes the chain of ownership back (if possible) to the date an item was created. Provenance can significantly impact the value of an object.

Reserve or Reserve Price

Never formally disclosed, the reserve price is the confidential minimum price agreed upon between the consignor and the auction house. Reserves must be set at or below the low estimate, and if bidding ends before the reserve is reached, the property will not be sold.

Seller’s Commission

A commission paid by the consignor to the auction house, which is deducted from the hammer price.

Valuation

A detailed description and current value of property prepared by the auction house’s staff. Valuations, which differ from auction estimates, are used for a variety of needs, including charitable contribution, collateral loans, estate taxes, estate planning and insurance.

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