dealer prices vs auction prices?
Simple question: is there a simple relationship to estimate dealer sales price from the auction price? Obviously this will vary but perhaps not so much for higher end, good condition, instruments (who's value is fairly well known at the time of the auction).
Wholesale (auction) is typically 50% of dealer price. But this is complicated by the fact that more and more players are showing up at auction, which may drive the prices much closer to the price that would be paid to a dealer.
As Lydia has said auction prices are siginicantly lower than dealer prices.
Auction prices can be half or less, than retail prices.
So the "MacDonald" viola offered at 45 million dollars a while back would cost 90 million in a shop!! However, no-one bought it, even at this generous 50% off!!!
Adrian - perhaps the more expensive the violin, the lower the markup? I mean if it was 10% you would still make 4.5 million$!
It also depends on whether the fiddle is a "diamond in the rough" -- if it needs repair.
As far as I know, when Strads are auctioned, it's never assumed that a dealer will win. It will usually be bought by a foundation or the like. The cost to have it repaired is trivial compared to the sales price, and the buyer is not taking a risk.
After I have been to a couple of auctions I gave up since I rarely found something completely attractive.
And to add: My guess for Strads etc. would be (unfortunately never had that situation on my own) that you can negotiate to pay no or only little premium since the expected buyer's premium is how and the prestige and advertisement is good for the auction house.
It is never simple in the violin trade...
Auctions are just another tool whereby the dealers keep us guessing.
Duane says it well. The first violin I bought at auction is still my favourite. A dealer friend who looked at it later said he "wouldn't touch it with a barge pole" but I love it to bits. My second auction violin plays beautifully but had a warped neck that added 60% to the price. I also bought an "interesting" violin with a hand-written label saying Carlo Bergonzi. After taking it apart to reglue the tailpin block and selling it for a small loss I'm still not sure what was supposed to be "interesting" about it. The latest violin I bought for £500 and sold for £1000 - result! After costs the profit was only about £200 and that soon got put towards an auction viola so my joy is likely to be short-lived. Bottom line: violin auctions are exciting and fun but never bid more than you can afford to lose.
"Auctions are just another tool whereby the dealers keep us guessing."
First of all...those selling and buying strads in auctions are not posting on this site. So for the rest of us...the one unique attribute that an auction provides is transparency. So for example imagine someone dies and has a valuable violin or bow and has five kids for whom the will says to split everything evenly. If you sell privately someone could suspect some kind of favortism or foul play. Selling in an auction is totally transparent. BTW I have never sold anything in an auction and purchased once....and got outbid a number of times.
Certainly nothing wrong with becoming a more educated buyer.I'm guessing you refer to in person auction as opposed to online auctions? I think higher prices are likely expected at the in person types of auctions.These would be instruments that have been valuated properly , or at least that would be the expectation.Unless there are specified dealer only auctions?
Occasionally, auction prices will be higher than retail. Think about it: if a bow you’d pay $8,000 for is priced at $7,500 by a dealer, you pay the amount and walk away. At an auction, you might compete with someone who shares your taste.
I guess I should explain a bit. The original reason I asked is because you can often find auction prices for violins (listed by the auction houses) whereas it may be more difficult to find them by dealers (especially for sought-after luthiers). Thus, if you are looking at an instrument at a dealership its useful to know the average auction/dealer price ratio just to be sure you are not way over the going price.
I don't blame dealerships for this approach, meaning the fact that there doesn't seem to be a hard and fast rule. They likely have a minimum markup
That's not the case, Timothy. Price haggling is the norm for instruments at almost all dealers. This is especially true if the instrument is a consignment. Sellers are often willing to negotiate the price in order to get their money sooner rather than waiting for another buyer to come along.
"Thus, if you are looking at an instrument at a dealership its useful to know the average auction/dealer price ratio just to be sure you are not way over the going price."
@ Tom Utsch: Selling in an auction is not necessarily totally transparent. I have the personal experience of selling items from an estate, which were delivered en masse to a lesser-known auction house. I had a time constraint so I couldn't pick and choose.
Student instruments that have a model number generally have public prices, because prices are easily compared online. You can still haggle, though. Shops may throw in a case for free, for instance.
I really need to thank this thread, it sent me off down an internet rabbit hole and I ended up watching a live auction and now I have a lovely old violin.
Brent when you say live auction do you mean live streamed internet auction or an in person auction? Can you elaborate a little more? Thanks.
Tom, are you positive when you state no one buying or selling a Stradivari posts here? How much are you willing to wager on that? :)
Nate: Xenu is watching...
You’re probably right Duane. I guess I won’t be getting their L. Ron Hubbard discount...
Out of curiosity for the veteran buyers/sellers on this board (not trying to derail the conversation from auctions, but curious about prices):
My experience with violin shops is that in the student price ranges, they'll just show you violins. A few hundred dollars tends not to make much of a difference. You might find that an $1800 violin is pretty comparable to a $2000 violin, or to a $2200 violin, for instance. They are all essentially in a single price band. As you go up in price, the bands get larger. The difference between a maker that typically sells their violins for $12k and one that typically sells their violins for $18k might not be meaningful.
Thanks Lydia and Duane,
@Timothy It was a live stream of an auction taking place in an auction house. I was able to bid for items in the auction via the Internet. I should be getting the violin back from the luthier I took it to this week. It needed some love.
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