Posted by Mike Brandly, Auctioneer, CAI, CAS, AARE in Auction School, Auctions, Contract law, auction, auctioneers, auctions, bid calling, bidders, buyer's premium, by the hour, Christie's, commission, contract, day rate, disclosure, expenses, fee, flat fee, forced sale, salary, Sotheby's. Today I completed my last auction until the buyer premiums go away. WebManta has 2 businesses under Auctioneers in Fontana, CA. Scott Hueckman, At least for us, we have to do what is customary.. I dont agree but I understand. Fees: For example, if our commission is 1%, a seller may decide to pay half, and have the buyers premium set to pay half. This is why DreamDirt is committed to a commission structure that places value for our sellers at the top. Then, on the other side, there is a buyer who upon, sold agrees to take title. So why are these online auctions any different? To decide youre not making enough so charge the winning bidder a buyers premium percentage to make up for that is ridiculous. Auctioneers charge the seller a commission, which is typically a percentage of the gross sales, or a minimum fee, whichever is greater. Net profit. The extra expenses are not tax-deductible nor recoverable. Here is a worked example of what we bring to the market place in terms of value: Sales Price 400,000 The Standard Industry Fee = 1.5%+VAT 400,000 x 1.5% = 6,000 (7,380 Inc. VAT) Our Fixed Price Fee =2,495 (3,069 Inc. VAT) That can be expensive. Change). Selling rural acreages often involves other brokers. Please dont pretend otherwise. Just a week ago winning items at online auction Bin Mayhem, Located in Glendale, az I was charged a Buyers Premium and the worst part about it is there is no terms of service mention of it or any agreement that has to be checked when signing up. Its no longer a good deal. In over 40 years of collecting, its been my experience that its understood that the seller pays for the service of listing an item, not the buyer. His pay, minus expenses, would come to $1,400. We help people sell land using listing and auction processes. They specialize in farmland sales primarily serving the heirs to family farms all across Iowa and surrounding states. For most auction houses, especially smaller ones, the buyers premium helps to cover the costs of running the auction house and its ongoing auctions. If you could get back with me it would be greatly appreciated the price how long and our jobs readily available and do you help me get started thank you Kelly Prewitt, Our school is http://www.theohioauctionschool.com. It is trite to say that. The best auctioneers can create a lively atmosphere and a real sense of urgency, which encourages buyers to bid above your reserve price. Its just a way for the auction company to double dip on their commission by charging separate fees to both the seller and the purchaser. At least for us, we have to do what is customary. WebThe important thing to remember is that your organization must calculate the fair market value of the goods and services the attendee receives in exchange for their ticket purchase. Car auctions often charge a flat fee per car, somewhere between $2501,000. Damn your math sucks. You should find that even after those auction charges are added on youll still be acquiring a great item at a price lower than in a high street store. According to real estate agents, if you're trying to sell a $700,000 house, your marketing costs can be between $6000 and $9000. If you refuse, the property is withdrawn from auction or 'passed in', though the highest bidder can still negotiate with you on the price. Exclusion or Modification of Warranties. Call, text or email to have a confidential conversation about commission fees. This is quite customary unless the asset total was significant, or possibly if real estate was involved. Top Selling Farms in Iowa This week's by Jason Smith | Feb 22, 2023 | Farm Real Estate Company, How To Sell Farmland, Iowa Auctioneers, Iowa Farm Real Estate, Iowa Farmland Prices, Iowa Farmland Report, Iowa Farmland Values, Iowa Land Auction Company, Iowa Land Auctions, Land Auctions. cannot be passed on to the buyer and explained away as But think about us were just a poor small business! Clients using our online farmland auction platform will find we are able to charge an even lower commission (for an equal, if not better auction experience) without the added expenses of venue, printed material, refreshments and travel.. Choose an auctioneer whose business is built on the success of your charity auction! The auction fees to buyers are typically added on to the hammer price. A rip off for the buyer and seller. For me, purchasing an item for $500 and then paying an extra $100 BP to own it isnt going to happenever. WebEstate Sale commission and fees are often negotiated before the final contract is outlined and signed. If you are the highest bidder on a lot at the end of the auction, the auction house's invoice to you will include all the fees. If the house added 12% to the sellers premium, the buyer could actually spend the amount he intends. 10012 Citrus Avenue . It is possible to sell your property before the auction date. While major auction houses (like Sothebys) will even charge up to 25% on items, most smaller auction houses charge anywhere between 1%-15%. I dont believe its a discount at all. However if the buyer still paid $123 that he was willing to pay, the result would be the same. I am having to pay for 3 months all my expenses myself. Even better, if you plan on using it frequently, you can sign up for a lifetime seller's plan and benefit from even more bonuses like free photos and no final value fees, amongst others, to save money in the long term. (512) 659-0617 In effect this really only hurts the seller who would therefore do well to consider the buyers premiums. That statement is like the disappearing penny. The hammer price is the value of the highest bid on an item in an auction. It would be wiser to state that the only ones left unmarred are surprise surprise the auction house. Nothing personal but this is not the way to go, especially as the seller already pays fees/commission to cover said expenses. To read more on that topic, click here. 2-706. While auction houses are pretty quiet about the commissions they charge to seller, they do advertise what the buyers premiums are going to be. This Buyers Premium is hiding behind the ruse that theyre being open and up front about what will be charged additionally but as much as thats true, its also actually sneaky. No hidden fees, period! They are. Sure they have bills but they make their money from the people auctioning stuff off. No more Flying Pigs & live auction! I have no choice if I want the items in the auction. Though I hate knowing the 18% buyers premium I just paid as a buyer is on TOP of the fee the auction house charged the seller, if they can get it, more power to them thats what free enterprise is all about. WebAuction com. Now if I was in the gallery bidding, I have to pay sales tax. it is nothing more then out right thievery. 9.1% of $11,000 means $1,001 to the auction house, $9999 to the seller; or $11,000 is a $10,000 bid with 10% premium of $1,000 added) . FIre them , and send a message no more buyers commisions!! But what really is a concern is why does the buyer pay a State sales tax on the buyers premium charge. Iowa Farmland Prices February 18th - 24th, 2023 A total of 2,209 acres were sold in Iowa this past week. They brought their item to the auctioneer to sell, If they get one commission from the seller, why should they get another commission from the same seller in the form of a buyers premium? At DreamDirt, we let the seller decide whether they want to pay additional commission to any buyers agent that registers a buyer. "You can expect an auctioneer to charge anywhere from $400 to $1,000 to sell your home.". We do not charge closing fees, advertising fees, or per bid fees. We believe our commission also helps relieve sellers of stress and ensures that your farm auction is done RIGHT. In other words, the consigner will net the same and the buyer will pay the same, no matter how the fees are charged. I love your response about the sad dance. I am an independent owner that auctions my collections of items that I have collected over the years. For these reasons, many auctioneers are paid rather handsomely. How can your cost of business enterprise (things which you have listed, and which ARE tax-deductible) have greater impact, and worth more consideration than my decreased income due to circumstances beyond my control? I suppose you could. I pay my own expenses for gas, insurance, road tolls and parking everyday I go to work. The really crazy part it is the auction is walmart etc; store returns and the so called auction is being operated by their employee at the same brick and mortar business where they sale retail in the back storage area of the business Make sure you clarify this upfront with your agent if you decide to sell via auction. Buyers premiums are not a new idea and have actually been used on and off throughout history. The goal of an auctioneer is to get the highest price for an item for the seller by means of a free and fair bidding competition among potential buyers. Auctioneers charge the seller a commission, which is typically a percentage of the gross sales, or a minimum fee, whichever is greater. Auctioneers charge their seller a single, fixed rate for their auctioneering services. You will need to inform the auctioneer what your minimum sale price is - this is called the reserve price. The buyers submits a $115 payment for a $100 auction, which nets the seller with less than $70 for an item valued over $500. 1 Technology Drive. Check pictures for more details and for sizing. If an item sells for $16,000, they could very easily contract that the auction house gets 9.1% commission off the total bid and the auction house and seller would earn the same as if they added a 10% buyers premium which went to the auction house (e.g. If the public band together and boycott these auctions then the practice would soon be stopped. BPs are double dipping. Not enough individuality anymore. Andrew Bost Benefit Auctions offers two fee options for clients to choose from. I pay and leave the store . CLAIMED Auction House. Its why theyre doing it and hiding behind customary practices. I think the buyers premium is not necessary, it is just another way to increase profits over what the seller pays. 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