Selling an oil painting for $500 is wonderful if the seller is expecting $200 and not good at all if the seller is expecting $2,000.
As a result of this important aspect of auctioneering, it is reasonable that auctioneers should seek to know what items are worth, in order to give their sellers realistic expectations.
And I suppose even wondering if a past auction resulted in a reasonable price is judicious — helping auctioneers to evaluate future transactions?
I remember before the Internet at conventions or other auctioneer-centered events talking with colleagues about certain property either we had sold or planned to sell.
Too, early in our careers we called in product experts several times (coins, trains, artwork …) prior to auctions to organize items and provide us (and our sellers) some predictions.
Now with the Internet, our methodology has changed … for one we have much more personal knowledge of market values and we can as well search online for past sales (eBay, WorthPoint and Zillow for instance) for additional information.
And apparently Facebook provides yet another forum for assessing market values, or does it? While a few posts I’ve seen have had good information, many have included wildly different views of value. For instance, a 1993 Cadillac Fleetwood is worth somewhere between $600 and $6,500? Yeah, probably.
I remember distinctly an auction appointment a few months ago where our eventual client had opinions of value for a certain drop front cabinet from several local experts ranging from $700 to $1,800. Yet, our more learned research indicated a value of more like $250 based upon recent past sales in our market; it eventually sold for $310.
What’s anything worth?
In strict terms, market value is an estimation (guess) of what the market will pay based upon certain criteria — most commonly recent sales of like kind in the same neighborhood (sales comparison approach.) For most auctioneers, market value of property is indicated by what it sells for; necessarily not what the neighbor, friend, attorney, daughter or anyone else just thinks it’s worth.
The issue with Facebook estimations is much is not based upon recent sales, and the neighborhood extends around the world. Even though the personal property market in the United States has flattened somewhat, different markets still exist and values vary … and “What I think it’s worth,” is not itself a recent sale; real property is even more “location-driven.”
However, the good thing about Facebook estimations in most cases is, they are offered by fellow auctioneers — those with a finger on the market nearly every day. So, I suppose some of those “What I think it’s worth” is based upon recalling recent past sales? Here’s hoping so.
My advise to auctioneers? The Internet provides a vast resource of past sale information, and while Facebook can provide some information, remember your browser can likely access better sites for value estimation.
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. He serves as Adjunct Faculty at Hondros College of Business, Executive Director of The Ohio Auction School and Faculty at the Certified Auctioneers Institute held at Indiana University.