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Sold: The Secrets of Auction Success

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

Auctions come in all types, from rural auctions featuring livestock and equipment, to free-wheeling automotive auctions where the rich and famous bid on rare and classic cars, to Internet auctions where bargain hunters can shop right at home. Every type of auction is fun and exciting, whether you're an active bidder or a quiet spectator.

At an auction, groups of buyers bid on items offered for sale. An item is presented for sale and the bidding begins, sometimes at a set minimum amount. The selling price gradually rises as buyers increase their bid amounts and when the gavel drops, the highest bidder is declared winner of that item. Another item is then placed on the auction block, and the action starts over again. Auctions can be good ways to determine the true value of certain items, especially if collectors are involved. When people really want an item they're willing to pay the full price that reflects the value.

There are many types of auctions, and the basic premise is the same. There are, however, specific rules and regulations in place for each type of auction:

* English Auction: This is the granddaddy of all auction sales. It's the basic style of bidders going up against each other in an open forum. The person who bids the highest amount gets the item.

* Dutch Auctions: This is basically the opposite of an English auction. In a Dutch auction, the auctioneer begins by offering the item at premium price, and then lowers his or her offer in increments until someone agrees to pay that amount. It's something like a game of chance, as buyers can jump in and pay a little more for fear of losing the item at the next lower price to someone else. With only one bid to end the sale, Dutch auctions are practical ways to sell items quickly.

* Sealed First Price Auction: In this kind of auction, all potential buyers place their bids simultaneously, but no one knows the bid amounts of the other participants. The person who bids the highest amount gets the item for his or her suggested price.

* The Vickey Auction: At a vickey auction, bargain hunters get even more than they "bargained for". Whoever bids the highest amount wins the item, but they don't pay their bid amount. Instead, they only need to pay the second highest amount.

* Buy-out Auction: Similar to an English auction, a buy-out features items offered for sale at predetermined prices to anyone who wishes to pay full price. These are also referred to as "buy now" prices. If no one in the group wants the item at full price, bidding will begin and the highest bidder wins the auction.

* Open Outcry: Most often seen in the stock and commodities markets, an open outcry auction involves trading in all corners of the arena. The growing popularity of the Internet and modern communications has seen this type of auction being replaced by electronic trading platforms operating over the worldwide web.

Auction sales are perfect venues for buyers to find all sorts of affordable treasures. Antiques, artwork, cars, collectibles, real estate and countless other types of new and used commodities are put on the block and sold to the highest bidder. With crowds of interested buyers flocking to these types of sales, the auction action can quickly escalate. When more than one buyer is determined to win the prize, competition can be fast and furious. In the end, the final sale price can easily exceed the actual value of the item.

Qualified auctioneers are hired for a flat fee or a predetermined percentage of the proceeds. These professionals know about the community and its buying preferences, and can provide hints and advice to obtain 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.

When mall walking gets a little dull flea markets fall a little flat, try searching for treasures at an auction sale. The excitement can run high, and you just might bag a real bargain on a true treasure.