Have you heard of the term “buyer’s premium” as it relates to auctions? You might assume it’s some random extra charge, but it’s actually in place to help the auction house pay its bills and to be able to offer future auctions. Basically a buyer’s premium is an additional charge on the hammer price or winning bid at an auction. It’s paid by the winner of the auction, and goes to the auctioneer as a remuneration. This helps cover the costs of the auction house and its auctioneers.
An Explanation of Buyer Premiums
Why is a buyer’s premium charged? Well, auctions aren’t free. They cost money to hold… and there are expenses involved in putting on an auction. What are some of those expenses? Well, of course there are staff wages, but also consider things like building rental, auction house set-up, advertising/marketing, heating and air conditioning, security services, computer websites and software, and maintenance of/upkeep of electronic equipment.
Buyer’s premiums are used to enhance the customer’s overall auction experience. They are fairly common for most auctions.
Not all auctions have a buyer’s premium attached, but many do… Clients usually add a 10% buyer premium to a sale, which then adds 10% to a winning bidder’s total bid price.
Wilson Auction & Realty Co. utilizes flyers and its website to specify details about auctions, including whether or not a buyer’s premium is charged. Our company handles residential, commercial, industrial, and agricultural auctions involving real estate, equipment, autos, machinery, and personal property in Ohio, Indiana and Michigan. If you have questions, please contact Wilson Auction & Realty Co. at 866-870-5500 or see this page. You can also utilize our online contact page, here. Fill out the form and send it, so we can get back to you as soon as possible with answers to your questions.