What’s the Difference Between an Absolute Auction and a Reserve Auction?

If you’re planning on shopping online this year, we always recommend taking a closer look at some of your local online auctions. From jewelry to furniture, antiques, collectibles, tools, and more, you’ll find it all in an auction. When you’re not in the auction business or if you’re not well-versed in how auctions work, it can be a little daunting to get started. After all, with all of the lingo and industry jargon, how can you be sure you’re navigating the world of auctions correctly? Well, we’re here to help you understand the difference between two types of auctions that you’ll typically see: Absolute and Reserve.

So, what’s the difference between an Absolute auction and a Reserve auction? Let’s talk about them.

What Is an Absolute Auction?

Many of the online auctions that you’ll see on reSettled Life’s bidding site are Absolute auctions. This means that the items available for auction sell to the highest bidder, regardless of price, at the close of auction. Various bidders place their bids with a common goal in mind, to win that item, which means prices may go up quickly. This benefits the seller, as they’re able to get more money for their items, especially when they’re featured in online auctions, which typically last for a few days, as opposed to an in-person auction which takes place during the course of a few hours.

Absolute auctions tend to draw a larger crowd because the bidders all know that if they are the winning bidder, they are guaranteed to walk away with the item. Top items we typically auction off during Absolute auctions include:

·         Collectibles

·         Furniture

·         Kitchenware

·         Home décor

·         Tools

·         Electronics

·         Vintage & antique pieces

·         Jewelry

The list goes on. These items are sold to the highest bidder at the end of auction, with no set minimum bid required.

What Is a Reserve Auction?

Unlike Absolute auctions, Reserve auctions do have a minimum amount that the seller will accept for their item. This amount is not released to the public, and if it is not met, the item may not be sold. Reserve auctions are also known as seller confirmation, meaning that if the bidders don’t meet this minimum requirement, sellers have the option to either: A.) let the item go to the highest bidder, B.) allow the Auctioneer to negotiate with the bidders to see if a sale price can be reached, C.) restart the auction and try again, or D.) not sell. Reserve auctions are typically reserved for higher ticket items, such as:

·         Vehicles

·         Boats

·         Machinery

·         Commercial-grade tools & equipment

This allows the seller to set a minimum price that they’re willing to let these items go for without the risk of settling for less.

Whether the auction you’re interested in is an Absolute or a Reserve auction, there are benefits to finding items at auction. For one, you’re able to shop from a more diverse array of items that you won’t be able to find in stores, and in many cases, you’re able to buy them for far less as well. This year, reinvent the way you buy and sell your belongings and consider giving online auctions a try.