Auctions in the United States are, by default, with reserve, meaning that the seller may accept or reject the highest bid received, and/or place a reserve amount (a minimum amount) on their item(s) dictating the auctioneer not sell them for any less.
Yet, some auctioneers sell items for less than these reserve amounts. How can this happen? How it was explained to me was that if the bid reaches an amount near the reserve (or even if it doesn’t,) the auctioneer can decide, unilaterally, to sell the item for less than the reserve, but make the consignor whole by reducing their commission, and/or making up any deficit. An example may be in order:
Julie has consigned an ornate fern stand to an auction house. The stand is possibly over 200 years old, and is quite fancy. Julie wants to sell this fern stand only if the high bid is $2,000…
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