Auction Glossary Of Terms
A lot of terminology is involved in auctions. Nazmiyal Auctions has gathered the most frequently used words and phrases here in one convenient auction glossary for reference.
A live auction happens in real time. This kind of auction is often seen on television shows or movies where the auctioneer is on site along with a number of bidders. Of course, the internet has changed the way live auctions can happen.
Some bids can happen by phone, absentee bid, or via the internet. Bids made online are received by a clerk, who submits all bids. The highest bid will take the lot as long as the minimum is reached.
Timed Auction, Online Only
Timed auctions are exactly what they sound like: these auctions have a specific deadline. The thing that is special about this type of auction is that it is only available online. These bids are completely automated, though the opening price tag is set by the auctioneer before the online bidding starts.
The amount of time the bid is open could be just a few hours, or sometimes it could be a few days. Those thinking of bidding online are able to see each lot and see the current bid.
Once a potential buyer examines the lots and chooses the one or ones he or she is most interested in, they can bid. It is important to point out that bidders can only place a bid at the increments given. Bidders participating in this type of auction will receive emails with information about the bid, such as being the highest bidder.
All participants will get an email informing them they are no longer the highest bidder, giving them a chance to raise their bid. There are times when some online bids are extended, but this only happens if the auctioneer allowed it before the auction started and only if a bid is placed before the time ends.
A person that cannot attend but still wants to have a shot at the lot can do so with an absentee bid. These bids are made by filling out what is sometimes referred to as the Absentee Bid Form. Some people refer to these types of bids as written in, commissioned, or ordered in bids.
This is the term used to describe the person that submits a written bid or an absentee bid. The person specifies how much he or she is willing to pay for a particular lot.
An appraisal is an expert evaluation of the item being bid on. The evaluation exposes the fair market value or the insurance value. The auctioneers use an appraisal to try to predict how much any given item is going to end up bringing in.
The insurance value simply represents the value an insurance company would have to pay to replace what is being bid on. In order to figure how much something might bring in, the appraiser has to consider a number of factors, like how much similar items sold for. It is important to keep in mind that appraisals are just estimates.
Artist Resale Right
The Artist Resale Right, or Droit de Suite as it is sometimes known, is a right adopted in the UK. The right says that any art sold that belongs to a living artist or an artist who died within 70 years of the date that their work is sold is entitled to royalties. The law applies to members of the European Union.
Items that are auctioned off come with flaws, which is something bidders are supposed to understand. When any item is auctioned off, it is implied that it is “as is.”
An auction is how some property is sold. It is open to the public one way or another, and each person is given the opportunity to bid on the item or lot. Some people refer to auctions as sales, while others call it a public auction or auction sale.
The auction block is a platform where all items being auctioned off are placed.
The auctioneer is the person selling the item. This person is responsible for a particular sale. Sometimes, the auctioneer is the person who takes in the bids, but sometimes this person lets a professional take the wheel.
The bid is the price the bidder is willing to pay. Most of the time, each bid is increased by a predetermined amount. It makes the process a lot easier and decreases the chances of error.
Bids are kept on a list, which is sometimes called the bid list. The list is created during and kept long after the bid is over.
This is the amount the auctioneer uses to increase the bid. Most of the time, the bidder has to bid a price 10 percent higher than the last bid, but this is not always the case.
Bidder (Paddle) Number
The bidder number or paddle number is used to identify each bidder. The person who is intending on bidding has to register for every auction so that he or she can receive this number, which helps with identification.
When a lot or item is not sold, the item is bought by the owner. It is kept and not sold to anyone. This also occurs if the item is bid on, but the minimum price set by the auctioneer is not met.
The price of the item is not the total purchase price. Items come with a buyer’s premium, which is added to the hammer price.
Cataloging is compiling all the valuable information about a lot or particular item. This information could contain the name of the artist or the maker of the item that is being auctioned off.
It contains detailed descriptions of the items in the lot or a singular description if it is just one item. Bidders find out where the item was made and how many other people have owned the item. Sometimes, bidders even learn about exhibitions that the item was in, among other information.
The clerk is the person hired to keep official notes on what was sold during the auction and how much. The clerk also notes who ended up with the item.
Every bid after the first one should be considered a competing bid. Of course, the form of the bid could change. It could be placed online, on the phone, a booked bid, or an absentee bid, among other types of bids.
The condition report is pretty important for bidders to read. This is where the details about the condition of the item or lot are written. Damage is written about in detail as well as other things the buyer may need to repair. It gives buyers and sellers a sense of security, knowing that transparency was observed.
Conditions of Sale
This statement is legally binding between the auction house or the gallery and the consignor. The agreement details everything the two parties are going to be doing, such as selling a particular item and what type of payment is expected or required. Regulations regarding the auction and buyer’s premiums are written in this statement.
The consignee is another word for the auction house or auctioneer. This is the entity that is going to be selling the property of the consignor.
The consignor is another name for the owner of the item or items that are going to be auctioned off. This person entrusts the property to the consignee in hopes that this experienced auctioneer will gather enough interested parties to get a good price for his or her item or items.
The cover is just the artwork or image the auction house chooses to create buzz or excitement. It is an ad that may entice buyers into bidding. Usually the cover is high-quality, which makes the item seem much more valuable.
The designation line usually appears in the catalog. It is here where buyers get to learn who the owner is. Of course, the owner is the person who can say how he or she wishes to be described. Some owners do not mind being named while others would prefer some other title, like “Distinguished Collector” or something along those lines.
The estate auction is an auction where all the items being sold belonged to a person who passed away. Most of the time, these auctions include personal property, though it also may include realty or other belongings that the family of the deceased or the managers are willing to part with.
Items or lots are given two estimates. One is low and the other is high but are both based on the opinion of experts. The estimates help both buyers and auctioneers know where this auction may be heading. The values given by these estimations were drawn from careful examination and research on items, like the one being auctioned off.
Fair Market Value
The fair market value is a word expert appraisers use to tell others how much an item might be worth should a buyer want to sell the item afterwards. Of course, the buyer has to find another collector who is willing to pay for the item. Sometimes, the value given for an item is close to the fair market value.
The fair warning is a warning given to all bidders that the end of the bid is nearing. This warning is given to bidders to give them an opportunity to raise their bids if they are losing. The auctioneer studies bidders and stops the sale if no one is willing to keep the bidding war going.
The auctioneer usually has a hammer or a gavel, which is slammed down to indicate that the bidding war is over and the lot sold or did not.
Grading basically describes the process examiners undertake in order to figure out the condition of a particular item. Details are written down, which helps describe the item to bidders.
There are times when auction houses guarantee a consignor that their item is going to be purchased should the item not reach the reserved price. The auction house usually partners with others to guarantee this purchase. Still, a guarantee is rarely offered because the auction house or third parties end up losing if the sale does not go well.
The hammer price is the last bid. This is the sale price, however, it does not include the premium.
Knocked down is a term used to tell everyone bidding that the hammer is coming down. It is meant to tell everyone they only have a few seconds to decide to bid or let the hammer come down. This usually signals the end of the bid since most people are usually done bidding.
The item or items being auctioned off. Most of the time, each lot comes with an accompanying number used to help identify it.
This is the number that identifies the lot. It is also the number used to link the lot to the corresponding spot in the catalog.
This term is used when the item or items being auctioned off are promised to the highest bidder. Sometimes this type of auction is called an absolute auction. Bidders love these because they know there is no minimum to reach, so they could potentially come out on top.
A bidder who is at the auction house ready to bid.
This bid is meant to beat another buyer’s bid.
The paddle is an object with a number. The number on this paddle is linked to a registered bidder and is used to identify them. The paddle can be easily seen by the auctioneer every time a new bid is placed. Thepaddle is collected at the end of the auction.
This is a term used by the auction house that tells everyone the lot did not reach the minimum. The item stays in-house though it may come back again.
The preview gives buyers a chance to see the item or lot before the auction date. Buyers get to inspect the item and see if they even want to bid on it.
Provenance is a word used to describe the process examiners took to authenticate an item. This usually happens by tracing back ownership as far as it could go.
Reserve or Reserve Price
The reserve price is the minimum the owner is willing to accept for the item in the auction. It is important that reserves stay below the estimate given by the appraiser.
The sale number is the number used to separate each auction. This number appears online and in print so buyers know which auction they should pay attention to.
This market sells items that were already sold at some point in the past, like an auction house.
This is the amount the owner of the lot owes the seller when the sale is complete.
This is the person who knows a subject or field well enough to be called an expert. A specialist is a valued person for collectors.
The starting bid is the initial price, which the seller usually assigns.
Telephone bids are bids that come in through the phone.
This happens when two bidders offer the exact same number at the same time. It is up to the auctioneer to break the tie up. The Terms and Conditions of the auction usually detail what happens in this situation.
The underbidder is the bidder who came in second.
Valuation is the value given to the property by the auction house. These are not auction estimates, so one should not be surprised if the numbers are different.
This is a phrase that describes an item that was removed by the auctioneer or sold before the auction. The information is given to interested parties as soon as it happens.