Auction Houses and Fees
Auction houses charge fees to sellers and buyers. Seller fees are negotiable. Buyer fees are typically 15-20%. In NSW, services can cost up to $6,000. Good auctioneers may charge $1,000, some as little as $400. To estimate a foreclosed home’s potential auction price, agents use 50-60% of market value.
Types of Auctions
Auction houses specialize in niches like art, antiques, vehicles, or real estate. Government auctions sell surplus, seized, abandoned, or forfeited property. Understanding these differences helps determine suitable methods.
Buyer’s Premium in Auctions
Definition and Calculation
A buyer’s premium is an added fee to the winning bid. It is calculated as a percentage of the high bid price. For example, if a diamond ring sells for $4,900 and a 10% buyer’s premium is charged, the premium would be $490.
Purpose and Cost
Buyer’s premium is charged to cover auction house expenses and generate revenue. This fee ensures comfortable buyer participation and efficient auction operations. It is typically a straight percentage of the final bid price.
Real Estate Auctions
Buyer’s premiums in real estate auctions are fees for auction house services. They vary in percentage and are worth considering for potential costs at auction events.