by Rich Harrington

Created on: February 11, 2009   Last Updated: February 27, 2009

A friend of yours tells you they bought this fabulous chair at auction for a steal. Another friend was at an estate auction and bought his wife a diamond ring for next to nothing. You imagine this is a bargain hunter's dream. But where to start?

The key to any auction is to know that Knowledge is Power. To be successful at buying at an auction, you need knowledge. Some of it comes from experience, other knowledge is acquired.

Auctions are at one of three levels, high end (think Sothebys), auction houses and farm auctions. The high end auction is what everyone thinks about when you imagine an auction. Men and women in nice clothes bidding in the thousands of dollars with little paddles for a painting. The pace is slow and measured. The auctioneer is clear and easy to hear. There is a catalog of items with an estimate of what the auction house thinks it should sell for. And there is a buyer's premium, which is a percentage of the item that the buyer must add on to the price. The auction house sale is a more typical auction. The location is usually a drafty old building with stuff everywhere. The auctioneer can sound like a tobacco auctioneer or quiet, but understandable. The items are usually not catalogued, but are displayed around the room. The pace is to get as much stuff out the door as they can. There can be a buyer's premium. The farm or house auction is held usually out of doors. The items are put on flatbed movable wagons and are usually in box lots. These are usually similar items but sometimes just stuff that fit in the same box. You have to peer into the boxes to see what goodies are hidden in there. The auctioneer usually uses a portable PA system and can be loud and fast. The pace is to get though the stuff quickly with some items dumped together to get a dollar bid.

The goal of an auction is to get the highest price for an item given the rest of the sale. Auction houses and farm auctions work more with quantity than quality. Your goal is to buy it at your lowest possible price.

One of the first things to know is what to buy. Rarely are you going see an item being raised up for bids and know what it is and what damage it has. The auctioneer usually tells you what they know about it, but it is buyer beware. So prior to the sale, auctions will have a preview and allow the potential buyers to look at the merchandise. Look carefully at the item you might like. Is it the manufacturer you expect it to be? Is it damaged? What price in your mind do you think

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