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Types of Auctions

Auction sales are traditional ways for sellers to find buyers, and for buyers to find bargains.

There are rural auctions featuring livestock and equipment, free-wheeling automotive auctions where the rich and famous bid on rare and classic cars and Internet auctions where bargain hunters shop from the comfort of home, antique auctions and more. All of these bring excitement, whether you're placing a bid or just biding your time as a spectator.

The basic premise of an auction is to have a group of buyers bidding on sale items. Each item is presented for sale and the bidding begins, often with a set minimum amount. Gradually, the selling price goes up as potential buyers increase their bid amounts. When the gavel drops, the highest bidder is declared "winner" of that item. Then, another item is placed on the auction block and the action begins again. An auction sale can be a good way of determining the true value of certain items, especially when collectors are involved. People who really want particular items are willing to pay a top price that reflects the value.

Of the many types of auctions, the basic premise is the same. However, each type of auction has specific rules and regulations in place:

* English Auctions: The granddaddy of all auction sales, this is the basic style that pits bidders against each other in an open forum. The item goes to the person who bids the highest amount.

* The Dutch Auction: Basically the opposite of an English auction, this kind of sale has the auctioneer offering each item at a premium price, and then lowering the price incrementally until someone agrees to pay that amount. It can be a stressful game of chance, causing buyers to jump in and pay too much, rather than lose the item to someone else at the next lower price. It only takes one bid to end the sale, so Dutch auctions can be practical ways to sell items quickly.

* Sealed First Price: Similar to a "silent" auction, this type of sale involves a simultaneous bidding by all potential buyers. However, no one knows the other participants' bid amounts. Whoever bids the highest amount gets the item at his or her suggested price.

* Vickey Auctions: Bargain hunters get an even bigger bargain at a vickey auction. The person who bids the highest amount will win the item, but is only required to pay the second highest bid amount.

* The Buy-out Auction: A buy-out auction is similar to an English auction, with goods offered for sale at predetermined prices. The auction begins, and anyone wishing to pay full price may do so. The preset amount is sometimes known as the "buy now" price. If no one wishes to pay the full price, open bidding will begin. The highest bidder will take the item.

* The Open Outcry Auction: This is the type of auction usually seen in the stock and commodities markets. An open outcry auction involves lively trading at every corner of the arena. With the ever-increasing popularity of the Internet and modern communications, this type of auction is being replaced by electronic trading platforms operating over the worldwide web.

Auction sales can offer buyers a quick and easy avenue to pick up all kinds of items. Collectibles, real estate, antiques, cars, artwork and countless other commodities, both new and used, are put on the block and available to the highest bidder. These types of sales draw crowds of interested buyers, and the auction action can quickly heat up when more than one buyer is determined to win the prize. The competition can be fierce, and final sale prices can easily exceed the actual values.

Most auctions are led by qualified auctioneers who are hired for a flat fee or a predetermined percentage of the proceeds. These professionals can provide information about the community and its buying preferences, as well as hints on obtaining the highest price for one's property.

Most auctioneers in the United States are licensed by the state after completing a series of oral and written examinations. An auctioneer must be reliable, with proven integrity and a good reputation. In addition to leading the sale, auctioneers are responsible for publicizing the events and resolving any disputes or conflicts that may arise during the sale.

If you get tired of mall walking, and find that rummage sales are little more than rubbish sales, scratch your bargain-hunting itch at an auction sale. It's an exciting experience, and you can bag a real bargain on just about anything you're looking for.

Article Source: http://www.inpop.net

Ardis Myles is an essayist for several web sites, on home business idea and device drivers topics.

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