When a loved one passes away or decides to sell the family home, it can create a stressful situation for those responsible for the house and its contents. Many people assume that the best way to sell the contents of a home is to hold an estate sale, also known as a tag sale. However, that’s not the only solution, nor is it always the best one. Holding an estate auction is an equally valid solution that can yield better profits.
Don’t assume that estate sales are always the best way to sell a lot of items at once or that they’re fundamentally the same as auctions. While both tag sales and auctions have the same purpose, the method of sale is different, and more often than not, so are the results. Before reaching out to auctioneers or estate sale experts in Raleigh, North Carolina, read on to find out about the key differences between these two selling methods.
What Is an Estate Sale?
An estate sale is like a garage sale, except that it’s organized by a professional and involves selling a home’s entire contents. Homeowners or inheritors reach out to the sellers, who price each of the items in the house or on the property and take a percentage of the sale’s profits as payment for their services.
The most common reason to hold an estate sale is the passing of a family member. While surviving loved ones mourn, they entrust the sale of the deceased’s possessions to a professional so they don’t have to handle any of the details. Typically, each piece is priced and sold separately, although it’s also possible to bundle items together, and buyers cannot negotiate prices.
Benefits of Tag Sales
Most people choose to hold tag sales because it seems like the easiest option. They can entrust the entire process to a professional, and the whole sale will take place over just a few days. Plus, estate sale companies typically pay their clients within two weeks of the sale’s completion, so people can access their money fast.
Drawbacks of Tag Sales
It’s hard to find reputable estate sale companies, so many sellers wind up making less than they should. Some companies price items higher than they are worth so they can route them to consignment shops associated with the business. Others price them too low, so clients miss out on good opportunities to make money. The real problem here is that the field of tag sales is completely unregulated, and there are no industry standards, which makes it difficult to find a reputable facilitator.
What Is an Auction?
Auctions are public events facilitated by auctioneers who sell items to the highest bidder. Instead of pricing goods in advance, these licensed industry professionals allow auction attendees to bid whatever they think the items are worth. This strategy allows for the discovery of the true market value of the items being auctioned.
Since the true market value of an item is contingent on what people in the crowd are willing to pay, auctioneers double as marketers. They need to draw in the right buyers, set the tone and pace of the event, and instill a sense of excitement and competition that will induce people to place higher bids. Instead of taking a percentage of the sales as payment, auctioneers typically request small commissions from sellers and add buyers’ premiums to every item sold.
Benefits of Auctions
Auctions are a better way to get fair market value for saleable items. Unlike estate sale facilitators, auctioneers are trained and licensed. They also take a lower commission from the seller, which means sellers who choose auctions instead of tag sales usually make more money from the contents of their properties. It’s also possible to pick and choose what will be placed up for sale instead of selling the entire estate.
Drawbacks of Auctions
Auction cycles are longer than estate sales, so while the actual event may only take a day, sellers may not receive payment for several weeks. Selling goods at auction also requires presenting the items to an auctioneer, so it’s considered a more hands-on approach. However, the payoff of getting a better price for items placed for sale generally outweighs these drawbacks.
Learn More Today
Interested in holding an auction? Carolina Auction & Realty is Raleigh, North Carolina, residents’ go-to for auctioneer and personal property appraisal services. Tom Jordan, the company’s president and owner, has conducted over 300 Auctions in NC, and even more across the country. Whether people want to liquidate businesses, auction real estate, or sell commercial equipment, they can call (919) 832-8005 to learn more about the process today.