Auctioneer's Glossary: Estimate, Bid, Hammer Price, and Other Terms

Auctioneer's Glossary: Estimate, Bid, Hammer Price, and Other Terms - AUCBURG

From Estimate to Sale: Estimate, Bid, and Hammer Price

Term	Description
Estimate	The pre-sale estimated value of a lot, set by the auction house's experts. It is an indicative price range that helps buyers get their bearings.
Bid	A bid or price offer made by an auction participant during the bidding for the right to purchase a lot.
Hammer Price	The final price of the lot, recorded by the auctioneer at the fall of the hammer. It's important to remember that the auction's commission is usually added to this amount.

Diving into the world of auctions begins with understanding the three concepts that underpin the entire bidding process. These are the pre-sale estimate, the bid itself, and the final price. Without a clear distinction between these terms, it's easy to get confused and make a wrong decision.

Every lot put up for auction goes through several key pricing stages. It all starts with an expert valuation and ends with the final fall of the hammer, which determines the new owner.

Thus, the estimate sets the tone, the bids shape the course of the auction, and the hammer price determines the winner. Understanding this sequence is fundamental for any auction participant.

The Rules of the Game: Reserve Price and Bidding Increment

Beyond the visible bidding war, auctions have hidden rules that directly affect the outcome. Two of the most important are the reserve price and the bidding increment. They ensure the fairness of the process for both the seller and the buyers.

The reserve price protects the interests of the item's owner, preventing it from being sold for a pittance. The bidding increment, in turn, structures the bidding, making it more predictable and orderly.

Reserve Price: This is a confidential minimum amount, agreed upon with the seller, below which the lot cannot be sold. If the bidding does not reach this threshold, the lot is withdrawn from the auction. Participants do not know the exact reserve price, but they are informed if it has not been met.

Bidding Increment: This is the minimum amount by which the next bid must be increased. The increment is set by the auctioneer and typically increases as the lot's value rises, ensuring a smooth bidding process.

Understanding these mechanisms allows participants to better predict how events will unfold and to build their strategy so as not to miss a desired lot.

The Rules of the Game: Reserve Price and Bidding Increment

Participating from a Distance: Absentee Bids and Post-Sale Offers

Tool	Description
Absentee Bid	The option to leave your maximum bid before the auction begins. The auction house will automatically place bids on your behalf, not exceeding the specified limit. This is a convenient way to participate without following the auction in real-time.
Post-sale Offer	An offer to purchase a lot that was not sold during the auction. After the auction, you can contact the auction house and try to acquire the item at a price within the estimate or by negotiation.

Modern auctions offer flexible participation formats that do not require personal presence in the saleroom. For those who cannot attend the auction, there are tools such as absentee bids and the opportunity to purchase lots after the main auction.

These options expand the pool of potential buyers and give a second chance to both unsold lots and those who missed their moment during the live auction.

Using these tools makes auctions accessible to a wide audience worldwide and helps ensure that interesting art and antiques are not missed.