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The Collecting Game: Buyer's Premium at Auction

by Sam Moore


Tags: collecting, auctions, buyer's premium, Sam Moore,

Sam Moore   
Sam Moore   

There are millions of collectors in the world who collect just about anything you can imagine. 

Paintings, sculpture, autos, books, stamps, dolls, trains, match books, baseball cards, antiques of all kinds, smoking paraphernalia, pottery and dishes, toys, comic books, jewelry, arrowheads, and even string and rubber bands – you name it and someone, somewhere collects it.

In our hobby, the emphasis is on tractors, and some bring big bucks. Some old and rare farm tractors today are routinely selling in six figures. I remember when I got into this hobby more than 20 years ago, it was almost unheard of to pay more than $1,000 for a nice looking and running tractor.

To demonstrate how much things have changed, at an Indiana sale last October a non-running, original and complete 1912 International Harvester 45 hp Mogul (serial no. X1281) sold for $275,000, while a super rare Galloway Farmobile said to be freshly restored (but still needing mechanical work?) was hammered down for $165,000. A 1913 Hart-Parr 30-60 “Old Reliable” in original running condition as well as a restored 1910 IHC 20 hp Mogul Type C each brought $140,000.

Getting back to collectors, what has always seemed strange to me is how intolerant many of these individuals are toward those whose tastes run to something else. Antique furniture vs. art; rare manuscripts vs. comic books; old tractors vs. old engines. Even within collecting categories, the differences can be intense: hit-and-miss engine enthusiasts turn up their noses at the guy who has a trailer load of Maytag engines; muscle car aficionados can’t see Model A Fords; farm tractor guys aren’t big on garden tractors. And then there’s the brand competition: Chevy vs. Ford; John Deere vs. Farmall; it goes on and on.

Sometimes the intolerance is due to snobbery, but it isn’t always about money. A man might drool over a concourse condition 1931 Model J Duesenberg with a selling price of $900,000, but would turn up his nose at a vase from China’s Ming Dynasty, such as the one that sold in Hong Kong in 2006 for about $10 million. Then there was the grotesque (to my eyes) life-size cast bronze statue called L’Homme Qui Marche I, or “Walking Man,” made in 1961 by Alberto Giacometti. The piece sold on Jan. 12 of this year at Sotheby’s in London for the improbable sum of $104,3 million. I know I wouldn’t give you more than “an old straw hat or a bucket of coal” for either the bronze or the vase, but I would sure love to have the Duesy.

Granted, the Giacometti bronze and the Ming vase are extreme examples of collecting mania, but serious collectors are willing to pay outlandish prices for that one coveted item that’s essential to round out their collection. For instance, at the same Indiana sale mentioned above, two metal signs sold at high prices. An IHC Mogul kerosene tractor sign in good condition brought $3,300, while an embossed Case sign showing “77 Modern Machines for Profitable Farming” with a wooden frame and surface scratches was hammered down for $2,200.

A sales catalog for IHC Mogul tractors, including the 20 and 25 hp Type C models with a color centerfold illustration of the 45 hp Mogul, fetched $600, and another lot containing a copy of the Husker, a magazine published by the Minneapolis-Moline Co. and featuring the MM UDLX Comfort Tractor, along with some Gleaner 6-foot combine literature, was taken away by a lucky buyer for just $500! Six issues of Gas Power magazine from 1913 and 1914 (none of which were in perfect condition) sold as separate lots and brought an amazing total of $540.

And that’s good, especially for the seller and the auctioneer. In fact, there was, on top of the prices paid during the bidding at the Indiana sale, a five percent “buyer’s premium” that each successful bider was required to pay. Now, I’ve never been able to understand just why a buyer should be required to pay a premium for the privilege of buying what both the owner and the auctioneer are anxious to sell. What do you think, is a buyer’s premium justified? Or is it just a gimmick to squeeze more dollars out of the sale?

samm
2/16/2014 11:50:03 AM

boleggs Yup, just the way I feel.


boleggs
2/11/2014 11:41:32 PM

I think I would be a bit upset to have to pay a "buyer's premium" for buying something at auction. If the auctioneer is also getting a percentage from the seller too, he's making some serious money. I just don't see the reasoning behind a "buyer's premium". It's just another way to gouge the buyer and get a little more for the auctioneer.