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For the vast majority of auctions in the United States, the auctioneer suggests a bid (invites an offer) and the bidders bid (makes offers.) Thus a contract is formed. We covered this basic concept in more detail here: https://mikebrandlyauctioneer.wordpress.com/2014/08/11/bid-calling-is-just-numbers/.

An out-of-town bidder arrived at our auction house last week and found me to ask a question. “This may be a silly question, but can I bid what I want to bid, rather than what you’re asking?” My reply was, “Of course, so long as it’s a higher bid than I have at the moment.” He replied, “Sure, I just don’t want to end up on the wrong number …”

Here was his issue: He attended an auction last night where his maximum bid on an item was $500. He was the high bidder at $475 and someone else bid $500 so the auctioneer asked him to bid $525. That was more than he was willing to pay … and thus his question.

Had this same bidder bid $500 last night (bidding what he wanted to bid) then the other bidder would have had to bid $525 (or more than $500) to outbid him. Soon after our discussion, an item was at $125 and I was asking $150. I looked his way and he bid $200. In turn, I asked $225 and nobody else bid. As I declared, “Sold!” I saw a smile appear on his face.

A related question might be, “Does an auctioneer have to take this $200 bid when asking only $150?” I would seem academic that he would, but is he required? In a without reserve (absolute) auction, property must be sold to the highest bidder. On the contrary, in a with reserve auction, it doesn’t necessary have to be sold to the highest bidder.

In with reserve auctions, auctioneers can set minimum bid increments — and outside of any state law which allows otherwise, in a without reserve (absolute) auction, property must sell to the highest bidder regardless of “how much higher.” However, generally bidders can offer whatever higher offer they wish and auctioneers are advised to accept.

I recall years ago where a somewhat well-known antique furniture dealer would “jump” the bid to try to intimidate other bidders. I would ask, “Start me out at $500 on this …” and he would — for example — exclaim quite loudly, “I’ll start you at $700 Mike …”

Can bidders bid what they want to bid? Auctioneers are inviting offers, so I say, “Make your [higher than I already have] offer” and it’s likely the auctioneer will accept it.

Mike Brandly, Auctioneer, CAI, CAS, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, RES Auction Services and Goodwill Columbus Car Auction. He serves as Distinguished Faculty at Hondros College, Executive Director of The Ohio Auction School, an Instructor at the National Auctioneers Association’s Designation Academy and America’s Auction Academy. He is faculty at the Certified Auctioneers Institute held at Indiana University and is approved by the The Supreme Court of Ohio for attorney education.