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Auctioneers incentive

  • 18-02-2014 9:01am
    #1
    ArraMusha
    Registered Users, Registered Users 2 Posts: 589 ✭✭✭


    Generally the rate charged by an Auctioneer is 1 to 1.5%, but could it be possible (maybe it's rampant) for an agreement to be in place whereby if a reserve is met anything over that is split fifty fifty?

    So for argument sake with a reserve of 100k, if 110k is the final achieved maximum, the auctioneer would get 110k X 1% = €1,100 plus €2,500?

    The reason I ask is there must be more of an incentive for auctioneers to get an extra couple of thousand than just the 1-2% commission surely?
    as they would only be getting €50 in every 5k.

    And the big question....If this 'agreement' exists, is there any way of using it to your advantage?..I'm doubtful.:(


Comments

  • #2
    Sleepy
    Registered Users, Registered Users 2 Posts: 24,367 ✭✭✭✭Sleepy


    I'm not sure that an auctioneer would need any additional motivation to try and push a price up tbh. and paying them an even larger chunk of the sale price seems like a dangerous precedent to be setting.

    Beside the financial incentive (while incrementally small), an auctioneer's reputation is going to be made on the sale prices she can attain for her clients.

    Nor am I convinced, tbh, that an auctioneer can do all that much to influence a sale price beyond providing the same advice anyone can get on TV/the internet to have the house decluttered when showing it, planting some flowers, painting in neutral colours etc.


  • #3
    Henry Ford III
    Moderators, Business & Finance Moderators Posts: 17,858 Mod ✭✭✭✭Henry Ford III


    1% is plenty for the majority of them imho.


  • #4
    Sleepy
    Registered Users, Registered Users 2 Posts: 24,367 ✭✭✭✭Sleepy


    For most of them you're over-paying tbh.


  • #5
    Nekarsulm
    Registered Users, Registered Users 2 Posts: 11,264 ✭✭✭✭Nekarsulm


    At 1%,. an Auctioneer is better off renting out your house for you, and taking one months rent as his fee. This is for property outside the Dublin area. If I sell my 3 bed semi in a provincial town for say, 110 thousand, the Auctioneer would get about 1100 euro, (as low as 60,000 sale price in some counties) sometime down the road when all the legal work etc. has completed. If he rents it for me, he gets 500 euro as soon as it is let. Rent it next year and he is at 1000 euro.
    If you are in an area where your property is likely to make 500,000, then you should try and do some kind of deal. It shouldn't affect final price, especially in an area where demand is high.


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