Watching the Antiques Roadshow recently, I was reminded of the most important question a professional should ask when valuing something: why are you having it valued? This is because valuations will differ depending on the answer.
Let’s consider a diamond ring, for instance. If you want it valued for insurance, you are going to need enough cover to replace it at retail cost. If you want it valued for sale to a dealer, the valuation must consider what a dealer might pay for it, so that they can build in a profit margin for resale. So, the insurance valuation might be as much as four times the resale value to a dealer.
Getting the asking price right is as much a skill at chattels auctions as it is when putting your home on the market: price it too high and you can kill demand but undercook it and you risk giving it away.
Overexposure over a prolonged period tends to raise questions as to the condition of the property on offer. A newly redeveloped house near me has recently gone on the market for around 30 per cent more than I would think is reasonable. This is because it will have been priced according to what the plot cost to buy, what the developer paid to knock it down and create the house that now stands there, and what their projected profit is added on top. No one has shown any interest. After a while, market reality will kick in and it will be re-priced accordingly, but that exposure will cost the owner dear and they may well end up with less than if they had simply pitched it at a more competitive rate in the first place.
It’s the same for chattels auctions. Those prepared to consign items at come-and-get-me estimates very often spark a bidding battle, with lots selling for what they really hoped to get for them, or even higher. Auctioneers will agree a reserve price with you, as a safety net, below which an item cannot be sold, so as a seller you are protected.
