Estate Auctions

Why Auctions Are the Best Way to Sell Unwanted Estate Items

Losing a loved one or moving them into a long-term care facility or senior living community can not only leave you emotionally drained, it can also leave you with a home full of belongings to deal with. While you and your family may want to keep some things for financial or sentimental reasons, chances are the majority of the belongings will need to be either sold or donated. Out of the numerous ways to sell unwanted items, the safest, easiest and most profitable is an auction.

Auctions are more profitable – As we discussed in a previous post "Are Auctions and Estate Sales the Same Thing?", items tend to sell for a higher price at an auction than an estate sale because bidders start low and drive the price higher instead of seeing a set price and potentially haggling for a lower one. Auctions are also more profitable than yard sales because they reach a larger market and people have several days to bid on items. With a yard sale, you are limited to the people who are available to come during the hours you are open, and when a customer offers you a price, you either have to take it right away or risk not having anyone stopping by who is interested in it.

Auctions are safer – Craigslist is a popular way to sell things and it casts a further net than a yard sale while still staying local enough for you to avoid paying shipping costs in most instances. However, there is the issue of getting the item to the buyer, which involves either them coming to your home to see or purchase what you’re selling, or you meeting them in a neutral place to make the exchange. Both of these options create a potentially dangerous situation. People have posed as potential buyers to gain access to a home, then come back to break in and steal things. This can also occur at yard sales if you have large items that are for sale but are still in your home. With an auction, only the people who have already bid and won items will be coming to the home, and the pickup is staffed by the auction company who is fully insured and bonded. Some auctioneers offer a two-hour or by-appointment-only preview time, which is also fully staffed.

Auction payments are more secure – Unless you sell things on a regular basis, you are probably not set up to accept credit cards, leaving cash or check as the only methods of payment. If you accept a check for a large purchase at a yard sale and it bounces, getting your money will be extremely challenging. And chances are a buyer will not be willing to wait until the check clears to come back to pick up a purchase. Mobile payments like Venmo allow you to take electronic payments, but buyers can cancel the fund transfer after they receive the item and before the money is deposited into your account. Buyers at an auction or online auction use credit cards to pay, making it more likely you will receive the money. Even if they do not pick up their purchases, per the terms and conditions of the auction the auction company can still charge their credit card and you receive the proceeds. The paid-for but unclaimed items are given to charity or you can choose to keep them.

Auctions are easier – Wouldn’t it be nice if someone came in and sorted everything you had to sell, made it available to buyers, handled the payments and purchase pick-up, and gave you the proceeds? That’s how auctions work. No more sorting, pricing, praying for good weather, lugging things outside, haggling over prices, or dealing with strangers. This doesn’t mean you have no control over the sale. You and your family members will decide what you want to keep before anything is put into the auction.

You’re dealing with enough already. Let a licensed auctioneer handle the unwanted items of the estate.

Are Auctions and Estate Sales the Same Thing?

When it’s time to downsize a home, people often turn to the professionals to sell their belongings rather than holding yard sales or trying to sell things on eBay or Craigslist. Auctions and estate sales (also called tag sales) are both ways to eliminate household goods and make a profit, and may seem very similar. But they are actually quite different.

Auctioneers are more accountable because they must be licensed in Kentucky to run live or online auctions and are held to a Code of Ethics. Their license number has to be readily available at any auction, and an address for complaints must be included in their contracts. Before a Kentucky auctioneer can be licensed, they must apprentice under a sponsoring auctioneer for one year, take 96 hours of classes, and pass two exams. All of this training benefits you because your sale is being handled by an educated, trustworthy person, This means they will help you get the most income for the items you are selling, and that you have a clear path to resolving an issue should one arise.

Estate sale companies aren’t licensed or regulated in any way, which means anyone can market themselves as an estate sale professional, even if they have had no training. Does that mean all estate companies are run by inexperienced people? Of course not. But they are out there, and if you have a complaint it can be much more difficult to get a resolution.

Another difference is the way your items will be priced. At tag sales, a price is marked on each item before the sale begins, which leaves nowhere for the price to go but down. Most people view estate sales as organized garage sales and haggle over the prices marked. Buyers will also often wait until the second or third day of the sale to buy because prices are reduced after the first day.

Prices start low at auctions and continue to climb based on demand. Some items that may not have seemed valuable can end up selling at a higher price if two or more bidders are interested. This means that as the auction progresses, your profit on each item increases, while with an estate sale, your profit on items decreases as day two and three approach.

At an auction, items that aren’t selling individually can be grouped together to make them more attractive to buyers. Estate sale items have already been priced and can’t be regrouped to increase their chances of being sold. Also, leftover items at estate sales often become the property of the company, so they can sell them at their next sale and not owe you any proceeds. This gives estate sales managers less incentive to get everything sold for you. If you are signing up to do an estate sale and don’t want them to take the leftover items, make sure you read the contract carefully.

A benefit to buyers at an auction is the ability to preview items for at least 12 hours before it starts. At a tag sale the selling starts as soon as people walk through the door, so buyers have to make quick decisions before someone else buys what they want. This may not seem important to you as a seller, but it actually is because your buyers won’t be rushing through your items to make sure they don’t miss out. Instead, they’ll have time to think about each one and may end up buying more.

The most important thing when hiring someone to help you sell your belongings is to find someone you are comfortable with and that you can trust. Ask friends or family members for referrals, take the time to get to know the people you’ll be working with, and understand exactly how your belongings will be sold.