Auction terminology

New to auctions or just don't get some "auction speak"?  Here is a list of common Auction Terminology and definitions for you to review!
Absentee Bidder:
A person who may not attend the sale but submits, in advance, a written or oral bid that is the top price he/she will pay for a given property.
Absentee Bid/Proxy Bid:
A method of bidding for those who cannot or do not wish to attend an auction. LiveAuctioneers allows a bidder to leave a bid on any item listed online by clicking “Bid Now” and entering a bid amount. All bids are kept confidential from the auctioneer and other bidders. At the time of the live auction, the bidding system will attempt to execute your bid at the lowest cost possible.
Appraisal:

A formal evaluation of the fair market and/or insurance value of a given property. Fair market value represents an item would bring at auction. Insurance value reflects what we believe it would cost to replace an item. 

"As Is:"
Also known as "as is, where is" and "in its present condition." Typically, this is a sign that no return privileges will be granted. This also means that the property is sold with all existing faults and imperfections. We encourage potential buyers to inspect each item carefully before bidding.
Auction:
A method of selling property in a public forum through open and competitive bidding. Also referred to as: public auction, auction sale or sale.
Auctioneer:

A trained professional who presides over the auction, initiating the sale of a lot by describing the item and starting the bidding. Once the first bid is made, others may offer higher bids. Bidders may be present in the saleroom, on the phone or online. Auctioneers also place bids on behalf of absentee bidders and finally determine when the highest bid has been made. If a work sells, the auctioneer announces, “sold.” If the item does not meet its reserve or there are no bidders, the auctioneer signifies this with a “pass.”

Auction Block:
The podium or raised platform where the auctioneer stands while conducting the auction. "Placing (an item) on the auction block" means to sell something at auction.
Bid:
The amount a prospective buyer signals the auctioneer he/she would pay to buy the lot during bidding. Bids are usually in standardized increments established by the auctioneer.
Bid Caller:
The person who actually "calls," "cries" or "auctions" the property at an auction, recognizing bidders and acknowledging the highest bidder. Commonly known as the auctioneer.
Bid History:
A historical list of all the bids made on a particular auction during or after the auction.
Bid Increments:

The amount by which the auctioneer increases the bidding. In general, the auctioneer will request bids of about 10% higher than the previous bid. For instance, if the bidding opens at $5000, subsequent bids of $5500, $6000, $6500, etc. would follow. The figure is generally rounded up or down at the auctioneer's discretion.

Bidder (Paddle) Number:
The number issued to each person who registers at an auction.
Buy It Now(BIN):

An option that sellers can include on their Auction listings. This features enables buyers to purchase the item immediately at a fixed price, as opposed to using the live auction bidding process.

Buyer's Premium:
An additional service charge, for which the buyer is responsible, may be added to the price of sold items. If so, this will be indicated on the item page.
Catalog or Brochure:
A publication advertising and describing the property(ies) available for sale at public auction, often including photographs, property descriptions and the terms and conditions of the sale.
Clerk:
The person employed by the principal auctioneer or auction firm to record what is sold, to whom and for what price.
Competing bid:
During a sale, the auctioneer may be accepting competing bids for an item from various sources; these include (but are not limited to):
  • bids from an in-house audience
  • telephone bids
  • book bids
  • absentee bids
  • other bidding platforms
Commission:
The fee charged to the seller by the auctioneer for providing services–usually a percentage of the gross selling price of the property established by contract (the listing agreement) prior to the auction.
Consignee:
The auctioneer or auction house operator to whom goods are entrusted by another (consignor) for sale at auction.
Consignor:
The person or authorized agent or entity that consigns goods to an auctioneer. The consignor is usually the seller.
Escrow:
Money held in trust by a third party until the seller makes delivery of the merchandise to the buyer.
Estate Auction:
The sale of property left by a person at his/her death. An estate auction can involve the sale of personal and/or real property.

Estimate:

Each lot is given a low and high estimate, representing the opinion of the auctioneer's experts about the range in which the lot might sell at auction. Estimates are based on the examination of an item and recent auction records of comparable pieces. An estimate provides prospective buyers with an important preliminary guide to value and is generally the basis for establishing the reserve price.

Fair Market Value:

A term frequently used by appraisers referring to their judgment and opinion about an object’s likely sale price if offered by a willing seller to a willing buyer. Since the auction process is open to all bidders, a sale at auction is considered to be a measure of Fair Market Value.

Fair Warning: 

A warning that's sometimes given by the auctioneer that the hammer is about to come down on a lot. The fair warning offers one last chance to increase the bidding. If there are no subsequent bids, the auctioneer’s hammer falls and the sale is completed.

Grading:
The process for determining the physical condition of an item. Different items have different grading systems.
Hammer Price:

The winning bid for a lot at auction. It is the price upon which the auctioneer’s hammer falls, determining the sale price, but does not include the buyer's premium.

Lien:
An adverse claim or charge against an item when that item is being used as collateral for a debt.
Lot:
An item or set of items for sale in an auction, lots are normally denoted by a "lot" number.
Make An Offer/Best Offer:

Make An Offer(MAO) lets you offer the seller a price you're willing to pay on Buy It Now items. The seller decides whether to accept, reject, or counter your offer.

National Auctioneers Association:
A U.S. association of individual auctioneers united to maintain ethical standards for the auction profession; promote the enactment of just and reasonable laws, ordinances and regulations affecting auction selling; make the public more aware of the advantages of auction selling; and generally improve the business conditions affecting the auction profession.
Online/Virtual Auction:
An auction that is for online bidders only and is not conducted in front of a traditional live audience. These auction types may have reserve items in which the auctioneers bid in order to protect the reserve.
On-site Auction:
An auction conducted on the premises of the property being sold.
On-site Bidder:
A bidder who is physically participating at the auction venue.
Outbid:
To submit a maximum bid that is higher than another buyer's maximum bid.

Pass/Unsold:

Terms used by the auctioneer when an item fails to reach its reserve at auction.

Preview:
Specified date and time a property is available for prospective buyer viewing and audits in advance of the sale. Also known as open house or inspection.

Provenance:

An important part of the authentication process, provenance establishes the chain of ownership back (if possible) to the date an item was created. Provenance can significantly impact the value of an object.

Reserve or Reserve Price:
The minimum price that a seller is willing to accept for an item to be sold at auction. This amount is never formally disclosed.
SMS Alerts:
Alerts sent via text message to your mobile device to inform you when another bidder has placed a bid on an item.
Starting Price:
The likely starting bid for a given auction, set by the seller at the time of listing.
Traditional Auction:
An auction that is conducted in front of a live audience at a physical location where the items for sale are located.

Valuation: 

A detailed description and the current value of the property prepared by the auctioneer's staff. Valuations, which differ from auction estimates, are used for a variety of needs, including charitable contribution, collateral loans, estate taxes, estate planning, and insurance.

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