An art auction is thrilling; the beauty of the art work, the rush of the auctioneer’s sing-song chatter, the excitement when the hammer drops. Even online auctions have a sense of urgency when the countdown clock is nearing the end and bidders vie for the final bid before the timer runs out. But before you reach for your buyer number or raise your hand (whether to scratch your nose or purchase a work of art), are you truly ready for the fast pace of an art auction?
Whether you plan to bid online or in person, the first thing a prospective buyer needs to do is to register as a buyer for the art auction. If you are new to attending art auctions, it is a good idea to visit one as an observer, without the pressure of participating.
Arrive at the art auction early, scope out the works and the competition, and get comfortable before the bidding begins. This is your opportunity to view the art, check out the information in the catalogue and ask questions about any works you are interested in. You will need to register, usually online 24 hours before the event, with identification and your financial credentials. Depending on the price of the works, you may be able to bid with your credit card as payment, or with a bank letter of reference. You may also bid by telephone if you are unable to attend in person.
When buying through an online art auction, you will most often pay by credit card. You will register with the auction site and provide your financial information to participate. You may bid by absentee, if you are unavailable on the day of the sale; this is an appropriate option if you are confident about the artwork and your bid. You may simply leave your maximum bid with the art auction company.
The Auction Process
Auction houses will prepare a catalogue of items for sale, including the order in which the items will be offered, any reserves and pre-sale estimates. Just follow the catalogue, familiarize yourself with the auction’s specific bidding rules, bid increments, and the final purchase price.
Since reserves and pre-sale estimates are less trustworthy in online auctions, it is important to fully understand what you are bidding on when purchasing online. Since the auction house doesn’t often have a relationship with the art works up for sale, there is not as much drive to get the best price possible. The sellers have much less to lose, while potential buyers can end up with a work of art which is overpriced, not what it was represented to be, and a case of Buyer’s Remorse.
The Psychology of Bidding
Don’t be fooled by a low starting price. It has been proven that when items are sold at art auction at a low starting bid, bidders are drawn into the event, investing time and becoming committed to the work, with the result often being a higher ending price. Know what your limit is and stick to it; don’t fall to the pressure of a crowd of other bidders, or the excitement when bidding speeds up.
Timing of Bids: When to get in, when to get out
Some buyers may question the timing; there are different rules of thought when it comes to bidding at an auction. You may want to bid early and stay in throughout the whole process, you may wait until the end to start bidding, or a compromise between the two is to place a small bid at the beginning and enter again towards the end when many other bidders have played themselves out. No matter what your strategy, just keep in mind the top price you are willing to pay.
After the Sale in an Art Auction
Once you have won the art auction for the item (or items) you bid on, you can check out and either take your works or arrange for shipping/delivery if they are oversized or need to be transported out of the area.
There are fees to be paid:
- Buyer’s Premium: this fee is collected by the auction house for its services in selling the artwork. Usually 10-20% of the sales price. Many reputable auction houses will make this clear, but when you are looking at auction items, don’t forget to add this in the final cost.
- Credit Card Fees: many auction houses pass on the credit card processing fee to the buyer, around 2-3% per transaction. If you can attend with certified funds, you can avoid this charge.
When you have won in an online auction, you will usually receive an invoice soon after the auction is over and will be given a set amount time (usually 24-48 hours) to arrange for payment and shipping of your purchases.
Becoming a Savvy Bidder
The best way to becoming an accomplished bidder (and buyer) of fine art at auctions is with time and a few successful purchases. Each time you attend and join in an art auction, whether it be online or in person, you will gain confidence in your ability to confidently participate in them. Whether auctions become your favorite method of obtaining art or an event you attend apprehensively simply because there is a work of art you really desire, you can now bid boldly, knowing you understand how to utilize your tools properly, your bidding hand or the mouse!