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AARE (Accredited
Auctioneer, Real Estate) |
The
professional designation awarded by the NAA
Education Institute to qualified real estate
auctioneers who meet the educational and
experiential requirements of the Institute and who
adhere to a strict code of ethics and standards of
practice. |
|
Absentee Bid |
A
procedure which allows a bidder to participate in
the bidding process without being physically
present. Generally, a bidder submits an offer on an
item prior to the auction. Absentee bids are usually
handled under an established set of guidelines by
the auctioneer or his representative. The particular
rules and procedures of absentee bids are unique to
each auction company. |
|
Absentee Bidder |
A
person (or entity) who does not attend the sale but
submits, in advance, a written or oral bid that is
the top price he or she will pay for a given
property. |
|
Absolute Auction |
An
auction where the property is sold to the highest
qualified bidder with no limiting conditions or
amount. The seller may not bid personally or through
an agent. Also known as an auction without reserve. |
|
Accounting of Sale |
A
report issued to the seller by the auctioneer
detailing the financial aspects of the auction. |
|
Agent |
A
person who acts for or in the place of another
individual or entity by authority from them. |
|
Appraisal |
The
act or process of estimating value. |
|
Apprentice Auctioneer |
An
auctioneer who is in training, operating under the
supervision of a licensed or experienced auctioneer. |
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“As Is” |
Selling the property without warranties as to the
condition and/or the fitness of the property for a
particular use. Buyers are solely responsible for
examining and judging the property for their own
protection. Otherwise known as “As Is, Where Is” and
“In its Present Condition.” |
|
Auction |
A
method of selling property in a public forum through
open and competitive bidding. Also referred to as:
public auction, auction sale or sale. |
|
Auction Block |
The
podium or raised platform where the auctioneer
stands while conducting the auction. "Placing (an
item) on the auction block" means to sell something
at auction. |
|
Auction Listing
Agreement |
A
contract executed by the auctioneer and the seller
which authorizes the auctioneer to conduct the
auction and sets out the terms of the agreement and
the rights and responsibilities of each party. |
|
Auction Marketer |
An
individual who contracts with sellers for the
auction method of marketing property. In the case of
real property, he or she may not actually conduct
the sale but is directly responsible for all aspects
of marketing the property. |
|
Auction Marketing |
The
method of marketing real property utilizing the
auction method of sale. |
|
Auction Plan |
The
plan for pre-auction, auction day and post auction
activities. |
|
Auction Price |
The
price of a property obtained through the auction
method of marketing. |
|
Auction Subject to
Confirmation |
(See
"Reserve
Auction") |
|
Auction Value |
The
price which a particular property brings in open
competitive bidding at public auction. |
|
Auction With Reserve |
An
auction in which the seller or his agent reserves
the right to accept or decline any and all bids. A
minimum acceptable price may or may not be disclosed
and the seller reserves the right to accept or
decline any bid within a specified time. |
|
Auction Without
Reserve |
(See
"Absolute
Auction") |
|
Auctioneer |
The
person whom the seller engages to direct, conduct,
or be responsible for a sale by auction. This person
may or may not actually call or cry the auction. |
|
Auctioneer
Subcontractor |
An
auctioneer hired by the principal auctioneer. |
|
Ballroom Auction |
An
auction of one or more properties conducted in a
meeting room facility. |
Bank Letter
of Credit |
A
letter from a bank certifying that a named person is
worthy of a given level of credit. Often requested
from prospective bidders or buyers who are not
paying with currency at auctions. |
|
Bid |
A
prospective buyer's indication or offer of a price
he or she will pay to purchase property at auction.
Bids are usually in standardized increments
established by the auctioneer. |
|
Bid Acknowledgment |
A
form executed by the high bidder confirming and
acknowledging the bidder's identify, the bid price
and the description of the property. Also known as
Memorandum. |
|
Bid Assistants |
Individuals who are positioned throughout the
attendees at the auction to assist the auctioneer,
spot bidders and assist prospective bidders with
information to help them in their buying decision.
Also known as ringmen, bid consultants, bid
spotters, or groundsmen. |
|
Bid Caller |
The
person who actually "calls", "cries" or "auctions"
the property at an auction, recognizing bidders and
acknowledging the highest bidder. Commonly known as
the auctioneer. |
|
Bid Rigging |
The
unlawful practice whereby two or more people agree
not to bid against one another so as to deflate
value. |
|
Bidder Number |
The
number issued to each person who registers at an
auction. |
|
Bidder Package |
The
package of information and instructions pertaining
to the property to be sold at an auction event
obtained by prospective bidders at an auction.
Sometimes called a bidder packet or due diligence
package. |
|
Bidder's Choice |
A
method of sale whereby the successful high bidder
wins the right to choose a property or properties
from a grouping of similar or like-kind properties.
After the high bidder's selection, the property is
deleted from the group, and the second round of
bidding commences, with the high bidder in round two
choosing a property, which is then deleted from the
group and so on, until all properties are sold. |
|
Bookkeeper or Clerk |
The
person who is responsible for the accounting and
paperwork at an auction sale. |
|
Broker Participation |
An
arrangement for third-party brokers to register
potential bidders for properties being sold at
auction for a commission paid by the owner of the
property or the auction firm. |
|
Buyer's Broker |
A
real estate broker who represents the buyer and, as
the agent of the buyer, is normally paid for his/her
services by the buyer. |
|
Buyer's Premium |
An
advertised percentage of the high bid or flat fee
added to the high bid to determine the total
contract price to be paid by the buyer. |
|
CAI |
Certified Auctioneers Institute. The professional
designation awarded to practicing auctioneers who
meet the experiential, educational and ethical
standards set by the Auction Marketing Institute,
Inc. |
|
Caravan Auctions |
A
series of on site auctions advertised through a
common promotional campaign. |
|
Carrying Charges |
The
costs involved in holding a property which is
intended to produce income (either by sale or rent)
but has not yet done so, i.e., insurance, taxes,
maintenance, management. |
|
Catalog or Brochure |
A
publication advertising and describing the property
or properties available for sale at public auction,
often including photographs, property descriptions,
and the terms and conditions of the sale. |
|
Caveat Emptor |
A
Latin term meaning "let the buyer beware." A legal
maxim stating that the buyer takes the risk
regarding quality or condition of the property
purchased, unless protected by warranty. |
|
Clerk |
The
person employed by the principal auctioneer or
auction firm to record what is sold and to whom and
for what price. |
|
Collusion |
The
unlawful practice whereby two or more people agree
not to bid against one another so as to deflate
value or when the auctioneer accepts a fictitious
bid on behalf of the seller so as to manipulate or
inflate the price of the property. |
|
Commission |
The
fee charged to the seller by the auctioneer for
providing services, usually a percentage of the
gross selling price of the property established by
contract (the listing agreement) prior to the
auction. |
|
Conditions of Sale |
The
legal terms that govern the conduct of an auction,
including acceptable methods of payment, terms,
buyer's premiums, possession, reserves and any other
limiting factors of an auction. Usually included in
published advertisements or announced by the
auctioneer prior to the start of the auction. |
|
Contract |
An
agreement between two or more persons or entities
which creates or modifies a legal relationship. |
|
Cooperating Broker |
A
real estate broker who registers a prospective buyer
with the auction company, in accordance with the
terms and conditions for that auction. The broker is
paid a commission only if his prospect is the high
bidder and successfully closes on the property. Also
known as a participating broker. |
|
Critical Path |
Sequence of key tasks to be done by auction
contractor or other designated parties on specified
dates, leading to desired goals. |
|
Dual Agency |
The
representation of opposing principals (buyers and
seller) at the same time. |
|
Due Diligence |
The
process of gathering information about the condition
and legal status of assets to be sold. |
|
Estate Sale |
The
sale of property left by a person at his or her
death. An estate auction can involve the sale of
personal and/or real property. |
|
Graduate, Personal
Property Appraiser (GPPA) |
The
professional designation awarded by the
NAA Education Institute (formerly American
Marketing Institute) to qualified property
appraisers who meet the educational and experiential
requirements of the Institute and who adhere to a
strict code of ethics and standards of practice. |
|
Groundsman |
(See
"Bid
Assistants") |
|
Hammer Price |
Price
established by the last bidder and acknowledged by
the auctioneer before dropping the hammer or gavel. |
|
Listing Agreement |
(See
"Auction
Listing Agreement") |
|
Listing Broker |
A
real estate broker who has a listing on a property
and cooperates with the auction company by allowing
the auction agreement to supersede his/her listing
agreement. |
|
Market Value |
The
highest price in terms of money which a property
will bring in a competitive and open market under
all conditions requisite to a fair sale, the buyer
and seller, each acting prudently, knowledgeably and
assuming the price is not affected by undue
stimulus. |
|
Memorandum |
Sometimes also referred to as a "Bidder
Acknowledgment," or "Broker Acknowledgment," the
memorandum is signed by those parties either on the
auction floor or in the contract room. |
|
Minimum Bid Auction |
An
auction in which the auctioneer will accept bids at
or above a disclosed price. The minimum price is
always stated in the brochure and advertisements and
is announced at the auctions. |
|
Opening Bid |
The
lowest acceptable amount at which the bidding must
commence. |
|
Multi-Property Auction |
A
group of properties offered through a common
promotional campaign. The properties to be auctioned
may be owned by one seller or multiple sellers. |
|
Multi-Seller Auction |
Properties owned by many sellers, offered through a
common promotional campaign are auctioned in a
single event. |
|
National Auctioneers
Association |
An
association of individual auctioneers united to
promote the mutual interests of its members;
formulate and maintain ethical standards for the
auction profession; promote the enactment of just
and reasonable laws, ordinances and regulations
affecting auction selling; make the public more
aware of the advantages of auction selling; and
generally improve the business conditions affecting
the auction profession. |
|
National Real Estate
Auction Committee |
A
national committee developed by the NATIONAL
ASSOCIATION OF REALTORS in April, 1990 to provide
education to members concerning real estate
auctions, identify issues and monitor, review and
analyze trends affecting the real estate auction
industry. It also is charged with formulating
policies for consideration by other policy-making
NAR Committees, its Executive Committee and Board of
Directors. |
|
No-Sale Fee |
A
charge paid by the owner of property offered at a
reserve auction when the property does not sell. |
|
Opening Bid |
The
first bid offered by a bidder at an auction. |
|
On-site Auction |
An
auction conducted on the premises of the property
being sold. |
|
Participating Broker |
(See
"Cooperating
Broker") |
|
Preview |
Specified date and time property is available for
prospective buyer viewing and audits. Also known as
Open House or Inspection. |
|
Referring Broker |
A
real estate broker who does not have a listing on a
property, but refers the auction company to a
potential seller for an auction. Usually earns a
flat fee commission for referring product to an
auction company. |
|
Regroup |
A
process used in real estate auctions where a bidder
has the opportunity to combine several parcels of
land previously selected by other bidders, thereby
creating one larger parcel out of several smaller
parcels. This process is often used in conjunction
with bidder's choice. |
|
Reserve |
The
minimum price that a seller is willing to accept for
a property to be sold at auction. Also known as the
reserve price. |
|
Reserve Auction |
An
auction in which the seller reserves the right to
establish a reserve price, to accept or decline any
and all bids or to withdraw the property at any time
prior to the announcement of the completion of the
sale by the auctioneer. (See also "Auction
With Reserve") |
|
Sale Manager |
The
person designated by the auction company who is
responsible for organizing the details of an
auction. Also known as project manager. |
|
Sealed Bid |
A
method of sale utilized where confidential bids are
submitted to be opened at a predetermined place and
time. Not a true auction in that it does not allow
for reaction from the competitive market place. |
|
Seller |
Entity that has legal possession, (ownership) of any
interests, benefits or rights inherent to the real
or personal property. |
|
Subject to
Confirmation |
(See
"Reserve
Auction") |
|
Tax Sale |
Public sale of property at auction by governmental
authority, due to nonpayment of property taxes. |
|
Terms |
The
period of time that an agreement is in effect. |
|
Terms and Condition |
The
printed rules of the auction and certain aspects of
the Purchase & Sale Agreement that are read and/or
distributed to potential bidders prior to an auction
sale. |
|
Tie Bids |
When
two or more bidders bid exactly the same amount at
the same time and must be resolved by the
auctioneer. |
|
Trustee's Sale |
A
sale at auction by a trustee. |
|
Upset Price |
Commonly known as the reserve price. |
|
Withdrawal |
Failure to reach the reserve price or insufficient
bidding. |
