Buyer beware! Whether you’re attending in person, or bidding online, auctions can lead to a serious case of buyer’s remorse.
Michele Clayton of Palos Verdes learned that lesson the hard way, after stumbling across a traveling auction at a local community center.
“I went for the entertainment,” she told the NBC4 I-Team. “I did not go to participate.”
But she admits she very quickly got caught up in the excitement of bidding.
“I purchased three rings,” she said, displaying the jewelry that cost her more than $19,000. “They’re nice and sparkly, as diamonds should be.”
Each ring came with documentation appraising their value. Clayton says Empire Auctioneers assured her the resale value would make them a worthy investment.
“It was an appraisal value of $80,000,” she said.
Clayton took the rings to two jewelers, hoping to sell them at a profit, “and they said they’re not worth it, they’re not worth the price,” she recalled.
“We hear horror stories week in and week out about that,” said Don Schireson, CEO of A.N. Abell Auction, a family-run business with 100 years’ experience, making it the oldest auction house in Los Angeles.
He offered advice to auction newbies:
“For the first time buyer, we say come in and look around in an auction, don’t buy,” he warned.
As for documentation that appraise the value of a purchase, “it has no relevance,” Schireson continued. “It’s what you can get for it with a willing buyer, a willing seller. That’s the true worth.”
In search of a refund on her diamond purchase, Clayton contacted Empire Auctioneers, and was referred to the terms of her signed sales agreement, which made the policy clear: “no refunds, no returns…merchandise sold ‘as is’.”
Clayton’s next call was to the I-Team, which contacted Empire on her behalf. The company refused multiple requests to speak on camera, but did reach out to Clayton.
“They started to backpedal,” she said.
Within days, Clayton received a letter from Empire Auctioneers, saying they had heard from a “source” that she was unhappy with her purchase, and promised to “gladly refund the full amount.”
Clayton can’t believe her luck in getting her $19,000 back, and says she’s learned her lesson. She also offers this advice to auction novices:
“Buy it because you love it, not because you believe the value that they tell you it is.”
A.N. Abell Auction CEO Don Schireson shared these tips, which can be applied to in-person or online auctions:
- Frequent only reputable auction houses.
- How long have they been in business?
- Do they have a permanent place of business with exhibition space?
- Do they offer enough time for auction exhibitions?
- Is the auction house bonded with the state of California?
- Stay away from auctions that take place in hotels, cruise line art auctions and estate auctions held in homes. You have little recourse if something goes wrong with your purchase.
- When frequenting an auction for the first time, ask the other auction goers about the auction house.
- Preview, Preview, Preview.
- Advantage of an auction house over an online auction is that you are able to spend time inspecting the merchandise.
- Be sure to only frequent auction houses that allow plenty of time for preview. An hour or two before the auction begins is not enough.
- Ask questions of the knowledgeable staff. How old is the item? Is it in good condition? What is the auction estimate? Take measurements if needed.
- Learn the auction process.
- Register to bid. If items are for resale, bring license.
- Inquire about payment. Does the auction house take credit cards? Is there a buyer’s premium and if so, how much?
- When is payment due and when do purchases have to be removed?
- Watch before you leap.
- Spend time (a week or two) watching an ongoing auction before you buy.
- See how other buyers bid and get used to the rhythm of the auctioneer.
- Ask other auction-goers for advice.
- When it is time to bid, have a price in mind and stick with it. Don’t get carried away.