The Greater Phoenix area has nearly 20 auction houses to choose from when you’re looking to sell an estate. With many choices comes varying levels of service and professionalism. I urge all my clients to do their research ahead of selecting a broker, because neglecting due diligence can have disastrous results. 

Auction houses can charge commissions between 35 percent and 45 percent, along with fees for other services such as listing items on the internet, cataloging, pick-ups and sorting. All of these costs eat away at the seller’s net and can often leave them disappointed. 

The two scenarios I see the most often resulting in angry clients are unfair contracts and long delays in receiving payments. The keys to avoiding these pitfalls are research and tenacity. 

Here’s what to watch out for: 


Unfair Contracts: Carefully read the entire printed contract and cross out and initial any contract section that favors only the auction house, such as “when signed” provisions. Do you still own the properties? Or have you signed the properties over to the auction house for them to do with what is best for the house and not for the consigner? 

Secondly, do not read and sign a contract that is presented to you on a computer. I’ve had clients lose ownership of properties and agree to pay unknown fees. 

If there is no physical contract and intake sheet listing properties to be sold, commissions and basic fees, find another auction house. 


Payment Delays: An auction house may string out an estate sale over a period of weeks to avoid paying until the last piece is sold. It could be a couple of months or longer before any money is received. What does the contract say about payment? Read it. 

A reputable auction house should send payment after each lot of properties is sold with a notation that other lots are still to be sold. Competent and financially stable auction houses use a sale, then payment and notation about unsold items, which is the successful formula. 

A recent client learned a hard lesson. He brought items to be sold at a local auction house and watched as numbers were placed on his items. He was thanked and sent on his way with no receipt for the consigned items and no discussion of commissions, fees or expenses. Three weeks later, the resulting gross sale receipts for his items added up to $325. 

After a 40 percent commission and $26 in fees, the auction house earned $169, while the client only took home $156. The client learned a tough lesson about the importance of asking the right questions ahead of time and getting agreements in writing. 

However, using the services of an auction house can be beneficial if one is selling high-end items. The nationally and internationally known houses have access to a network of customers worldwide who trust their services. 

But regardless of the size or reputation of the auction house, reading contracts and defining parameters is still absolutely necessary to protect yourself as a seller. 

— Contact Tom with a question or an appraisal issue: or send your letter to 5525 N. 12th St., Phoenix, 85014.