There are probably as many reasons why people sell at auction as there are auctions.
Everyone’s circumstances are different. The reasons why goods and property are put up for auction rather than being sold through a private sale vary enormously. It’s very rare indeed for the real reason why something is being put up for auction to be disclosed. However, trying to understand why people sell at auction can help you enormously when it comes to picking up a bargain.
While we were preparing this guide we contacted a wide range of auctioneers as well as traders who make their living buying and selling at auction. Here’s a list what they consider to be the top ten reasons why people sell at auction:
A property being sold at auction may have belonged to someone who died in testate.
The property has been repossessed by a bank or building society – such repossessions occur at all levels of the property spectrum, and while they are at their highest levels during recessions, they happen all the time.
Disposable property – commonly an old barn on a farm, or painting, or antique – is often put up for auction when times are hard and cash is needed urgently.
Anonymous disposal – a company that made a mistake and bought too much stock; they want to sell something quietly without advertising the fact through a private sale. An auction is the perfect vehicle.
Quick disposal – if you want to sell something quickly (especially antiques and collectibles) – and you want your money fast without having to wait months to make a potentially better private sale – then an auction is the way to go.
Auctions are the favoured way for large companies and government agencies and departments, for example the Ministry of Defence, to dispose of unwanted assets quickly.
Some people believe (wrongly) that they will always get a higher price at auction.
Many people don’t want the bother of placing an advertisement and dealing with potential purchasers involved with a private sale. For them an auction is much less trouble.
Auctions are perfect places to dispose of goods taken in part exchange or demonstration models.
Goods that are approaching the end of their useful lives – such as high mileage vehicles – and whose faults and deficiencies quickly show up at a private sale, are usually sent for auction.