Advice: Buying and selling at auction

Date 06.7.2015

Presented by
  • Motorcycle Trader

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Buying and selling at auction

Auctions are likely to become an important avenue for motorcycle sales as the internet has made them accessible to a larger “live” audience.

Motorcycle auctions can be roughly divided into two types: classic and ‘trade’ auctions.

Classic auctions usually feature older motorcycles, say 25-plus years, and cater to a specialist audience such as collectors of a particular marque or enthusiasts looking for their next restoration project.

‘Trade’ auctions sell fleet motorcycles, such as postie bikes or military police machines. Insurance companies use these events to unload written-off motorcycles. Finance companies also send repossessed bikes to these ‘trade’ auctions and they are increasingly being promoted as a place for private sellers to lodge their motorcycle for sale.

Motorcycle magazines and online sites are a good resource for finding an auction house that suits your needs.

When searching the internet, add ‘Australia’ or site:.au to exclude results in San Francisco or London.

Also, ask around your friends – if any of them have been a vendor or buyer they can give you some tips.

auction-hammer

SELLING

Image a room full of potential buyers for your bike. Add the registered phone and online bidders and selling at auction starts to look inviting.

You need to find out what an auction house offers you as a vendor.

The catalogue, preferably searchable, should be available online well in advance. Some companies email fully-featured catalogues to people on their customer list.

Ask how far in advance they want your bike on their premises. It is to your advantage to have as many potential buyers as possible see it before the sale so try to fit in with what the auction house requires. Decide how you will transfer your bike there: ride it, by trailer, or via a transport company.

The auction house staff deal with motorcycle sales every day and will be able to give you an estimate of your bike’s selling price.

Some companies allow you to put a reserve on the lot you offer, particularly for a classic bike. Your decision depends on many factors such as likely market value, what return you expect from the hours and money you have spent on it and does it suit you to take an unsold bike back into your life. Some auction houses charge greater commission and/or administration fees for a bike with a reserve.

Ask what commission and other expenses are due on a sale and how they are calculated.

If your bike doesn’t sell, find out what costs you are liable for and how quickly it must be collected.

Decide your maximum budget before attending the sale. Catalogues, particularly for classic auctions, may include an estimated price range for each lot. Past auction results and adverts for similar bikes in the media are good pricing resources.

Red Book offers an online estimate for a wide range of popular motorcycles.

It pays to be aware of certain legalities if planning to buy at auction. For instance, the cooling-off period does not apply. As the auctioneer is acting as an agent for the vendor, you are not entitled to the consumer guarantees you must be offered in a retail sale. However, you still have rights to full ownership, undisturbed possession and no hidden charges.

At auction, bikes are usually sold unregistered and are not required to have a roadworthy certificate.

All written-off motorcycles in Australia are entered on the Written-off Vehicles Register (WOVR) and the registration cancelled.

A written-off motorcycle’s classification must be included in the catalogue. They are:

REPAIRABLE WRITE-OFF: A bike damaged to an extent considered uneconomic for an insurance company to repair. Such a bike can be re-registered if it is repaired in accordance with the manufacturer’s standards, its identity verified and it has passed a Vehicle Identity Validation (VIV) inspection.

INSPECTED REPAIRABLE WRITE-OFF: A bike previously assessed as a repairable write-off (as above) which has since been repaired, completed a VIV inspection and been re-registered. Each state and territory manage their own inspections scheme and differences may exist.

STATUTORY WRITE-OFF: This bike is so severely damaged it cannot be re-registered. Only certain parts from such a bike may be used to repair another bike. The auction house must attach a large label clearly identifying the bike as a statutory write-off.
Contact your state or territory vehicle authority for more information.

DO YOUR HOMEWORK

Auction houses vary in the pre-sale access allowed to potential buyers. A test ride is not allowed. Some companies provide a condition report, the bike may be started on request, or an onsite inspection may be permitted. Check the company’s website or ask the staff to find out what they allow.

Also, find out what fees you will be charged on top of the hammer-fall price. This may include an administration fee and/or a buyer’s premium. These extras are often a percentage of the hammer-fall price and should be within your maximum budget.

You will need to register to bid in person at the auction. At a minimum, your name, address and some form of identification (such as a current driver’s licence) and your signature are needed. You will receive a numbered card or paddle that you raise to register a bid.

To be a phone or internet bidder, you will need to supply further information, including credit card details. This can be done online. The auction house will then give you instructions on how to be an online bidder.

If yours is the winning bid, a deposit (typically 10 per cent or $500) is required at the close of the auction. This is automatically charged to the credit card of a successful phone or online bidder.

The balance needs to be paid usually within one business day of the sale.

Once purchase is finalised, you need to promptly remove your new bike from the auction house.

Remember that most lots are unregistered, therefore cannot be ridden. A local purchase can be trailered, but if you bid interstate or overseas you need an exit plan.

Auction houses can recommend commercial freighters, but research this yourself in advance.