Greetings and Salutations...
Indeed, auctions can be a costly game. That is
why it is REALLY good to attend a few, and get a feel
for what goes on before doing serious bidding.
One has to remember that the auctioneer is
not only NOT your friend, his job is to run up the
selling price as high as he can. In most cases,
auctions are held to try and recover cash for
assets. The bank (if that is the lien holder)
REALLY wants to get at least as much out of the
stuff as they have in it...and more is better.
I have been to a number of places where
used equipment went for WAY more than I thought it
was worth, and I was trying to be objective about
it. I thought in some cases, it was out of community
sympathy for the guy getting his stuff auctioned off.
I thought in some cases it was simply a bunch of
cash-heavy yuppies that did not have a clue what
was an apt price, and were caught up in the excitement
If there is a "buyer's premium" on the auction,
that is typically going directly into an auctioneer's pocket.
Do I have to mention that 10% of $1000.00 is rather more
than 10% of $100? That sort of thing gives an
auctioneer an incentive to push the prices up
as far as possible.
So...I suppose my rule of thumb is this. Get to
know the auctioneers at your local auction houses by
going to auctions regularly. Figure out which ones
are good at whipping up enthusiasm and which are not.
Try to ONLY bid when the bad ones are auctioning and
don't get caught up in the frenzy when the good ones
are on the floor.
Finally, although it is likely to be a fairly
rare thing, make sure that you know WHICH auction houses
like to use shills and "phantom bids" to make it look like
there is more action on a piece than there really is.
Most reputable auction houses will not do this...but...
Well.. Probably the one thing that R. Reagan and I
agreed on was his comment about "Trust But Verify".