Market Madness: Art Auction Insider’s Glossary

Master the Vocabulary of the Art Auction

The Basics

1. Lot: A single object or group of objects offered for sale as a discrete unit.

2. Hammer Price: The winning bid reached when the auctioneer’s gavel falls. Note: This does not include the buyer's premium.

3. Buyer’s Premium: An additional fee (usually 15–25%) paid by the winner on top of the hammer price to cover the auction house’s costs.

4. Increment: The set amount by which a bid is raised (e.g., the auctioneer moves the price up by $10,000 each time).

The Financial Guardrails

5. Reserve: The confidential minimum price agreed upon between the seller and the auction house. If bidding doesn't reach this, the item isn't sold.

6. Guarantee: A commitment by the auction house (or a third party) to buy the work at a specific price if no one else bids higher.

7. Estimate: The range (Low to High) that the auction house expects a work to sell for, based on recent sales of similar art.

8. Buy-In: When a lot fails to reach its reserve and remains unsold. It is "bought in" by the house and returned to the owner.

Bidding Variations

9. Absentee Bid: A bid submitted in writing before the auction starts for those who cannot attend in person or online.

10. Telephone Bidding: A staff member in the room talks to the bidder over the phone and relays their bids to the auctioneer.

11. Chandelier Bidding: A tactic where the auctioneer "takes a bid from the air" (often looking at a light fixture) to create momentum and move the price toward the reserve.

12. Paddle: The numbered card used by bidders in the room to signal their intent to buy.

The "Status" of a Work

13. Withdrawn Lot: An item removed from the auction before the bidding begins, often due to a legal issue or a last-minute change of heart by the seller.

14. Provenance: The "pedigree" of an artwork—the history of who has owned it from the day it left the artist’s studio to the present.

15. Commission Bids: When the auctioneer has several bids on the books before the lot even opens.

16. Fair Warning: The final call an auctioneer makes before the hammer falls, giving everyone one last second to bid.

Advanced Industry Terms

17. White Glove Sale: A rare and prestigious event where every single lot in the auction is sold (100% sell-through rate).

18. Consignor: The person or entity (the seller) who has turned the art over to the auction house to be sold.

19. Condition Report: A detailed document provided by the house describing any damage, repairs, or wear on the piece.

20. After-Sale: When a lot fails to sell at the podium, but a buyer negotiates a price with the auction house immediately after the event.

Produced with Ai Assistance.