2004 Auction Overview
- By Michael Stillman
Over 114,000 book-related lots sold at auction in 2004.
By Mike Stillman
Last month, we had the opportunity to look at the top 350 prices paid at book auctions in 2004 See: AE Top 350. This month we have a chance to dig more deeply into what happened. Auctions provide the critical data needed for understanding the book market because this is where sales are taking place in the open market. Prices on the bookselling sites like Abebooks and Alibris may be interesting, but books may sit there for years without selling. In some cases they are discounted when sold. As these sites' listings continue to grow at rates far outstripping sales, it's clear that many of these prices represent dreams, not reality. Auction prices are reality.
Getting an overall picture of book auction results has been extremely difficult because the information is scattered in catalogues and on websites all over the world. However, over a year ago, the Americana Exchange began compiling listings and results from auctions for its AE Database of books. While the intent was to make thousands of individual auction records available to Database subscribers, it has enabled us to take those records and sort them in numerous ways to create a picture of the overall market. That picture is most interesting. We now present those results to our readers as we think you will be as intrigued as we were.
In 2004 we covered 276 auctions, mostly in North America and Europe, offering over 114,000 lots. Currencies were usually U.S. Dollars, Euros, or British pounds. In some cases, we have used the selling currencies, in others, converted them to equivalent dollar amounts to make comparisons clearer. In the article that follows, we'll mention some of the things we found, and provide a few overall charts. To see more detailed charts, including results from specific auction houses, follow the instructions in the box below. They are easy, fast, and free.
See Detailed Charts from 2004 Book Auctions
If you are already an AE member, the above link will take you directly to the charts. If not, it will take you to a simple free sign up form. It takes only a moment. We will immediately email you your log in name and password. Then, you can click here or "2004 Auction Results" on the left side menu (under "Free Services") to see the charts.
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First we'll take a look at what percentage of lots actually sold, and how many exceeded or fell short of the estimated price range. Many people think that virtually everything that is put up for auction is sold. Not so. As the following chart reveals, roughly 24% of the lots offered last year were not sold. That doesn't mean no one wants them. More likely, the reserve was too high for the market. That leads to the question of what becomes of these books. That depends on whether the auction house purchased the books or is simply auctioning them on behalf of someone else. What it does mean is someone is still holding onto a lot of books, tens of thousands by our count, that they really wanted to sell.
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2004 Auction Overview
- By Michael Stillman
The median price was $413, but very high priced lots drove the average to almost $3,000.
Another interesting set of numbers is the percentage of lots sold above versus below the auction houses' estimate range. Overall, the number sold above runs significantly higher. Almost twice as many books sold above the high estimate as below the low estimate. What does this mean? Was the market better than most people expected? Are book prices soaring? Not necessarily. Most auctions have minimum bids. Some have hidden minimums, also known as "reserves." And some auctions have minimum bids as high as their low estimate. Naturally, these houses won't have sales below the low estimate but they will usually have unsold lots because every lot won't attract a minimum bid. To make the comparison fair, we'll add the number of lots unsold to those sold below the low estimate and compare that to the number sold above the high estimate. After all, unsold lots are, in effect, lots that could only sell below the low estimate. When you make that comparison, a very different picture emerges.
For 2004, 27% of the lots sold below the low estimate, 49% above the high. But, include unsold lots as lots "sold" below the low, and the ratio is 45% below the low estimate, 37% above the high. Now it looks like the estimates run a bit high, or sale prices were somewhat below expectations. Here are the charts.
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2004 Auction Overview
- By Michael Stillman
Chart shows how many lots sold over or under the estimate, or not all all.
Of course this is just a summary. If you click the link to "2004 Auction Results" on the left sidebar (be sure you have signed up for a free or paid membership) you will see results for individual auction houses. These results may help you plan your strategies if bidding at auction and give you some idea of what to expect.
While the average sell-through rate at auction was 76%, individual results run from 100% to under 50%. What does this mean? If sell through is at or near 100%, it means the auction house is using either very low or no reserves. You're more likely to find an item slip through at an unusually low price at such an auction. If sell through is lower, it could mean a couple of things. It's possible that an auction was not well attended, the material was obscure, or some other factor kept bidders away. Another, and perhaps more likely scenario, is that the house rejects bids that are significantly below their low estimate. If a house has a lower sell through, but few lots sell under the low estimate, this is a good sign that they are rejecting most lower bids. If there is a lower sell through but still many items sold below the low estimate, it may mean that some of their auctions were overlooked, a good reason to check out what they might be offering next time.
There is one other factor that can lead to a lower sell through. Ultimately, the consigner gets to set minimum acceptable bids. An auction house may advise, but if the consigner sets minimums that tend to the high side, the percentage of lots sold will be low regardless of the auction house.
If the implication is that a house is rejecting most bids below the low estimate, it could happen in one of two ways. The house may state that the minimum acceptable bid is the same as or close to the low estimate. You will know in advance that it is pointless to bid if you do not feel the item is worth the low estimate. However, some auctions will have unstated minimums. They may start the bidding lower, but the house itself will outbid you should you bid a lower amount. We don't approve of this practice as it erroneously lets the bidder believe that his bid will be accepted if no one else places a higher one. Nevertheless, this practice is permitted under current auction standards, though we believe in time only stated minimum bids will be used. Undisclosed reserves discourage participation.
Why do some houses have unusually large numbers of sales either below their low or above their high estimates? There are a number of possible reasons. Prices in a field may be rapidly rising, their estimations may be unrealistic, or they may simply use a very tight range or single price, which will result in having many sales both above their high and below their low estimates. However, some houses tend to skew their estimates to one side. You might think they would all tend to estimate high, resulting in more sales falling below the low estimate. After all, if people believe an item is worth more, won't they bid more? And aren't they more likely to bid if they think their price is a "bargain?" It doesn't seem to make sense to estimate low, and some houses do estimate a bit to the high side. Nevertheless, some auctions estimate low. The logic is to encourage more participation. If you think an item could go cheaply, you may choose to participate, and then as the price rises, if your heart is set on it, you just may chase it up. If an auction house consistently sells items above their maximum estimate, it is possible they are estimating low.
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2004 Auction Overview
- By Michael Stillman
Sample from sales rate chart accessible with free membership.
Our next chart looks at pricing by month and for the year. What was the average price for 2004? $2,965. The median price? $413. Why is the median price so much lower? The answer is those occasional million dollar items drive up the average price. The median, the midpoint or typical selling price, more accurately reflects what items are selling for. That's still a healthy price. I do not know what the typical price is on eBay, Abe, Amazon, or in the average store, but I'm quite sure it's nowhere near $413. You may well find some good bargains at the book auctions, but don't expect to find things that are cheap because they generally sell premium material. Most auction houses won't handle material not expected to bring some minimum price, or if they do, they will combine several books into a single lot until they think it will garner an acceptable bid. It just isn't worthwhile to spend the time on a cheap item. So if you are looking to find a thousand dollar book for $5, go to eBay or a yard sale. You probably won't, but it's theoretically possible. Look to the auctions for a $1,000 item that might slip by for $700, or look to the auctions to find a $1,000 item for $1,000 when others want $1,500. Auctions are the place to find fair value when others want more.
Again, if you click "2004 Auction Results" on the left sidebar (and you have signed up for a membership) you will have access to the detailed breakdown of these results, specifically, numbers by individual auction house. We have results both in local currency and converted to U.S. dollars for easier comparison. You will be able to see median and average prices at each auction house and into which price ranges most of their lots fall. It will give you a good heads up on what to expect at each house's auctions. If looking to sell, it will help you discern which is the appropriate auction. If your books are likely to be worth thousands of dollars each, they may be appropriate for houses like Sotheby's or Christie's. If more likely worth $100 or $200 each, they will not be of interest to these houses, but you will find many others who would undoubtedly welcome the opportunity to sell your collection.
For non members wishing to see these charts, sign up for a free membership now. Click here.
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