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The arithmetic of buying at auction can furrow the brow. Recently I bought a late 17th-century walnut and elm chest of drawers 39 inches wide from a West Country firm of auctioneers. I bid for it by telephone. The photograph in the catalogue and on the internet showed a handsome chest of four mitred-panel drawers and bobbined mouldings, with small damage to the top edge moulding and other minor blemishes. The estimate was £500-£600. On auction day the telephone call came in good time, the bidding started at £400, and by the time I had run it up to £500, it stopped. The chest was mine for that hammer price.
Buyer’s premium of 19.5% and VAT took the cost up to £617. I now had to get the chest some 200 miles to my house. If I went myself, I calculated that the 400-mile round trip would take £75 of petrol at 32 miles to the gallon (or 7 miles to each litre costing £1.30) and 8 to 10 hours of my time. I phoned a carrier in the West Country and was quoted £95 plus VAT for carriage, with delivery within one week. A carrier near my home wanted £270 to fetch the chest. I accepted the West Country quote with alacrity and paid £114 including VAT when the chest arrived. It now stood me in at £731.
I was reminded of all this soon afterwards when I received a mail shot from a firm offering to cut out auctioneering margins by buying antiques from me – or anyone else – and selling them ‘direct to the buyers’. The arithmetic used to illustrate the difference between the price paid by the buyer and the amount received by the seller at auction was graphic. On a hammer price of £8,000 the buyer would pay a premium of 25% plus VAT, requiring a total of £10,400. After deducting fees, illustration, insurance and VAT from the hammer price the seller received just over £6,000, a difference of some £4,300. The advertisers wrote that by using their services these margins would be avoidable. There was no obligation if they visited me and they would pay immediate cash for my antiques. My goods would be sold ‘direct to the buyers’. Evidently I did not feature as a buyer.
TV programmes have a habit of avoiding the auction margins that have to be paid. They exult when a ‘profit’ is achieved by selling at more than the purchase price. It is well to be aware of the premiums extracted from the nominal, hammer price. What the mail shot advertisers avoided saying, after they had discreetly and privately visited to make a professional valuation and offer the ‘very best prices’, was how you would know that these prices were in fact so, and for what price they would just as discreetly sell to their clients. It is true that for items under £25,000 Sotheby’s and Christie’s have increased buyer’s premiums to 25% plus VAT, but the merit of an auction, for all its margins, is that it is an open market to which anyone can come and bid. There is thus a relation to what the outside world, wholesale or retail, is willing to pay. Discreet intermediaries offering to buy goods would be more convincing if they cited the margins or commission that they guaranteed to charge and this was less than the sum of those at auction.
My chest required repair to the damaged top edge moulding, treatment for woodworm, repair to a stile foot, re-gluing of two mouldings, ditto two side runners that slot into thick oak drawer linings, removal of old dark varnish, minor surface filling, some staining to match colours, and repolishing to a glowing 300-year-old walnut and elm shine. It pleases me enormously. This is not to say that I have not bought splendidly from dealers and sold to them many times; I have and often bless them for it. But the current situation, in which antiques requiring just minor repair seem to be disdained by auction buyers, presents opportunities unlikely to be matched. Not even by discreet, no-obligation house visitors, critical of auctions, operating on unspecified margins whilst selling ‘direct to the buyers’ but clearly more interested in getting through my front door than anything else.