“Sold!” Or is it? Auction Houses & Chandelier Bidding

“Sold for $500 to Norma Bernstein!” The auctioneer's gavel falls, and another sale appears to be in the books. But wait... there was no sale? What just happened?

Enter the world of Chandelier Bidding, also known as Buy-In bidding or Off-the-wall bidding. It's a practice where the auctioneer feigns bids from the room to stimulate bidding, create a sense of demand, or nudge bidding closer to the reserve price. In simpler terms, it's a staged bid.

Auction houses often employ chandelier bidding to enhance the perception of a lively auction. They believe that the appearance of bids encourages more bidding, ultimately leading to a more successful auction. Additionally, these bids can prompt existing bidders to exceed the reserve price, ensuring the item doesn't go unsold.

But is chandelier bidding ethical? Auction houses argue that the true results are revealed in post-sale reports, and consecutive bids only affect attendees on the auction floor. Critics, however, contend that it's misleading, distorting the true level of interest in an item.

So, is chandelier bidding a helpful tactic or a deceptive ploy? As auction consultants with over two decades of experience, we've seen it benefit some clients while others see no impact. While it's a theatrical aspect of auctions to be aware of, there are other critical auction practices to understand.

For expert guidance in navigating the auction world and maximizing your returns, contact Drew Magnusson today at 973-425-1550.

Co-Authors: Lynn Magnusson, ASA, AAA and Becky Lipnick, Communications Coordinator