I wonder sometimes … how often is it really selling absolute?
I see absolute auctions advertised all the time, all over the United States.
However, how often is that really the case?
Let’s look at some examples:
$3,000,000 +/- home to be sold absolute to the high bidder — no minimums and no reserve — except with only 4 bidders present, suddenly the assisting auctioneer is on the phone with an unidentified phone bidder.
50+ commercial bulldozers, graders, trucks and trailers are scheduled for absolute auction — except that nearly 1/3 sells to a company owned by the seller who then consigns them again to this same auctioneer for their next auction.
Antique and collectible absolute auction begins and the mother, daughter and brother bid on all the “better items” with those same items showing up at the next auction — where the same thing happens again.
Real estate auction selling absolute where once the auction is started, there is a bid of nearly 70% of the perceived value, and with no other bids, the auctioneer says, “Sold!” but the transaction never closes.
Absolute multiple parcel ballroom real estate auction where all the property is sold to the highest bidders, but when the bidders go to the back of the room to sign paperwork, nearly all are required to pay additional amounts, or be denied title.
Absolute online auction of high-end jewelry items. Nearly 80% of the items are sold to 1 of 3 different bidder id’s and none of those bidders pay for their items, so the jewelry is returned to the seller.
Over 1,000 acres is set to for absolute auction, but with 2 minutes until start time and only 27 registered bidders, the auctioneer cancels the auction, and invites those interested to, “make us an offer.”
A collectible car is advertised to be sold absolute, but the auctioneer begins the bidding by taking bids from all over the room — from the light fixtures, doors, windows, ceiling … until finally saying, “Sold!” and pointing up the air as if the winning bidder is sitting in the roof rafters.
A live and online absolute auction of collectible relics has about 15 live bidders in the audience, and yet one Internet bidder wins nearly all the items, which are then packed up and returned to the seller as unsold.
If I said that I had actually witnessed or had been provided firsthand evidence of all these examples, would you believe me? You should.
Sellers are lead to believe that an auction can be advertised as absolute, but they can still protect against or ensure a certain price. Bidders lose confidence that their bid will be accepted in good faith, and that the property is indeed being sold absolute without any games …
We are all seeing more and more high-end real estate and other high priced chattels advertised for absolute auction. It seems the first question that comes to my mind (and to many others) is if the property is really being sold absolute, or if there is some scheme in place such as a shill bidder, fake phone bidder, disingenuous (planted) bidder or phony online bidding.
In fact, when many auctioneers advertise property selling absolute, potential bidders will often call the auctioneer to question if the property is really selling absolute; a sad commentary on the public’s view of auction advertising generally.
Do some auctioneers conduct truly “absolute auctions?” Sure, all the time. Yet, there are others who continue to make it difficult for those honest, ethical auctioneers by using absolute auction marketing as merely a bait and switch.
The word “absolute” is compelling. Bidders have a right to assume they have an opportunity to buy at “their price” and that the seller has committed to convey title to the high bidder; and, that’s the way it should be.
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. His Facebook page is: www.facebook.com/mbauctioneer. He serves as Adjunct Faculty at Columbus State Community College and is Executive Director of The Ohio Auction School.
Comments