The highly anticipated auction at the Springfield VFW hall started at 5:00 p.m. with over 120 in the room.
The initial bid was $1,000 per acre, and quickly rose to $5,000 per acre.
The crowd increasingly grew quiet as the bidding continued past $6,000 per acre. One such attendee remarked, “You could feel the electricity in the air.” Another said, “I think I forgot to breath.”
As the bidding reached $6,250 per acre, the auctioneer asked for $6,300. The auctioneer’s breath could be heard clearly over the microphone as not another person uttered even a sound.
After about 30 seconds, a bid for $6,300 came in, and the bidding continued all the way to $7,500 per acre. A bidder later recalled, “I could feel my heart beating through my hands,” as she clutched her auction brochure.
Just then, the auctioneer said, “Folks, I have $7,500 right here” pointing to a bidder near the back of the room, “and we’re going to take a 10-minute break, and get right back with you.”
Thus, “Let’s take a break …”
Auctioneers cite several reasons for taking breaks during auctions:
- To consult with the seller … to discuss if the bid is high enough.
- To ask the seller a question … such as, “Do you want to offer anything else to encourage more bidding?”
- To clarify an issue … someone has asked about a property line, or water supply, or deed restriction.
Yet, other auctioneers argue that taking a break is counter-productive; they say by breaking,
- That mesmerizing, hypnotizing effect of all the, “fast talking” is lost.
- The bidders have a chance to, “come to their senses.”
- It becomes difficult to recapture that, “electric, heart racing” environment.
Why do auctioneers talk fast? We wrote about that here:
Possibly the most material reason we found in regard to talking fast was this:
- The “yes” factor – As David Palmer, Ph.D, CPA, notes:
“Fortunately, people often say ‘yes’ or agree with requests out of mindless compliance, they are frequently willing to say ‘yes’ automatically without thinking first. It makes their lives simpler and smoother.”
Mindless compliance? How could someone cause someone else to act out of mindless compliance? I think the answer is, “don’t give them a lot of time to think about it.” I’ve discussed with auctioneers all over the United States, and there does seem to be agreement that we talk fast to give the bidders less time, “to think.”
It’s hard to argue with the theory that by giving bidders more time to think, they tend to bid less — and conversely, if you give bidders less time to think, the more likely they are to bid.
Proving our point to an extent, one bidder remarked shorty after the break started, “I didn’t even realize how tense I had been — I had lost track of time … I hadn’t even realized Aileen was sitting right next to me.”
In talking with another auctioneer in Indiana, his opinion on taking a break was clear:
- “I always tried to take a break at our real estate auctions to — you know — let the seller think about lifting the reserve, and the bidders could think about how much more they could spend.
- However, I don’t take breaks any more.
- About six months ago, I took that break at about $4,250,000 on an airport property. Not a minute later, my high bidder said, ‘I want out … I’ve bid too much.’
- As the UCC 2-328 allows bidders to retract their bid up until I say, ‘Sold,’ I had no choice but to let him out. By the time we got the auction restarted, we got up to $3,000,000 and we were done.
- Our seller would have taken that $4,250,000 that we had, but turned down the $3,000,000 offer, and we had a no-sale. Never again …”
It is prudent for an auctioneer to take a break — after property is put up for bid and bids are received — but before “completion of the sale?”
As our Indiana auctioneer later remarked,
- “You better have a really good reason …”
Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. His Facebook page is: www.facebook.com/mbauctioneer. He is adjunct faculty at Columbus State Community College and is Executive Director of The Ohio Auction School.