Selling or Donating Items
My first contact with a client often comes when they approach me with an old Insurance Appraisal asking me where they can sell their items at the prices listed in the appraisal. Often they have misunderstood that the insurance value is totally different from the value they would receive if they sold the item. The insurance value is really the cost it would require for you to go out in the marketplace and replace the item. It is not the value of the item if you were to sell it in the secondary market which is what is usually available to most individuals. Most people would sell to a dealer, an auction house or another consumer by way of the internet, consignment store, tag sale or estate liquidator. The items sold in this secondary market are lower in value than the items sold directly to the consumer from a art gallery, antique store or other retail establishment.
There are several ways to go about selling an item. You may want to consider selling the item at auction. An auction tries to match up items with dealers, gallery owners and collectors. If the auction house is really good and they see a special item come through then they will contact the collectors that they think may be interested. In essence they try to drum up business making sure they get as many people as they can to bid on the item. They also spend money on advertising and they often list their auctions online so that people can bid on platforms like liveauctioneers.com or invaluable.com.
Auctions come with both the potential upside of a higher price than expected and the possible downside of a disappointingly low price. Often the auctioneer will come to your home to take away the items to prepare them for sale. The fee to sell at a auction houses varies depending on where you are and how the sale is conducted. Generally the higher the value of the items being sold the lower the commission. Commissions commonly range from 10% to 25% of the hammer price. Plus, there may be fees for transportation, storage or marketing. Sometimes the fees and commissions can be negotiated depending upon the material that you are trying to sell and the value and rarity of that material.
If you have an item that is rare or an item that is in high demand by very specific collectors you may want to consider an auction. Auctions fall into several categories. There are specialty auctions where collectors for that particular item go to purchase exclusively and there are auctions where all kinds of household items are sold where most of the buyers are direct purchasers.
You can run an estate or tag sale by yourself or you can hire someone to run it for you. If you are selling a lot of items from your home you may find hiring someone to be the easiest way to sell. You have to keep in mind that your items have to be worth at least, say, $10,000 in order for an outside company to agree to hold your sale. Sometimes estate liquidators can take up to 35% to 40% of the total money collected.
They often have connections with local, regular buyers of antiques and other items you may have. They will advertise your sale with signs and they will often place ads in local newspapers. They typically price items and set them up in your home in a way that is attractive. Often you can sell your items at a higher price if the display is attractive. Often times you will have a better chance of selling items from your house than other venues because buyers can more easily visualize them in their own homes. Staff can be present to control crowds and keep an eye on the cash register.
There are also estate liquidators that are willing to take your items away in order to sell them. Some of these liquidators sell the items online. You should make sure to ask if there are additional fees beyond the standard cut, for advertising, cleanup or an opinion of value.
Some of these liquidators and auction house people will give you opinions of value. That is a little different from an appraisal. An appraisal is a written document with sales comparables that are used to determine the value of an item. These sales comparables are kept in a work file along with any notes the appraiser might have from their research. An opinion of value is an opinion based on experience and not actual comparables. It is also an opinion of what the item would sell for at their sale, be it an estate sale or an auction sale. They are using their expertise to give you a verbal opinion of value. Many times these verbal opinions of value will be free with the expectation that you will use their auction or estate sale services.
You may decide to have someone sell the items online for you or you might want to do it yourself. Sometimes you can organize, take pictures and measurements and download information on a site to sell the item directly. There are websites like Etsy, eBay, Craigslist and sometimes Facebook.
EBay takes a 10% cut of your sale unless you have an eBay store and PayPal takes 2.9% plus 30 cents per domestic transaction to process payments. Plus you will want to estimate how much to charge the buyer for shipping. You can use tools on the websites of the U.S. Postal Service, UPS or FedEx to estimate shipping prices.
Posting and selling household goods on Craigslist is free but you are limiting your market to just locals. You also have to be willing to have strangers come to your home to pick up the items. Lower value goods and bulky ones that you would rather not ship are good candidates for Craigslist.
Giving items to charity can often save you the hassle of trying to sell them. Thrift shops such as Goodwill, Big Brothers Big Sisters of America and Salvation Army stores will take a variety of items. You can go online and see if you can schedule a pick up or you can drop the items off at one of their facilities.
If you have anything with cultural or historic value you may want to give the item to a local museum. Churches can sometimes use items as well. Make sure you get a receipt for the items that you give so that you can use it on your tax forms. Please check with the IRS or the government website to make sure that you follow all of the rules for donation. You can give up to $5,000 without a written appraisal by a qualified appraiser. If you are making a non-cash charitable contribution for more than $500 but less than $5,000 you must fill out Form 8283 and attach it to your return. If you claim a deduction for more than $5,000 then you will need a qualified appraisal and Form 8283. You can keep the qualified appraisal in your own files in case the IRS requests a copy. If the property is worth more than $500,000 then you must attach the qualified appraisal to your return with the Form 8283.