If you are new to auctions, the phrase “buyer’s premium” can be confusing, and it catches out more first-time bidders than anything else. This guide explains exactly what it is, how it is calculated at Clumber Auction House, why auction houses charge it, and how to factor it into your bidding.
The buyer’s premium explained
A buyer’s premium is a charge paid by the winning bidder on top of the hammer price. It is the auction house’s fee for running the sale on the buyer’s side: cataloguing and photographing the lots, running the saleroom and the online platform, insuring the goods while they are in our care and, not least, paying the staff who answer your questions at viewing. It is expressed as a percentage of the hammer price and is always stated in the auction house’s Conditions of Sale and catalogue.
How is it calculated at Clumber?
At Clumber Auction House the buyer’s premium is 18% of the hammer price, on every lot in every sale, whether you bid in the room, live online, by absentee bid or by telephone. Here is how the total works out:
| Hammer price | Buyer’s premium (18%) | Total you pay |
|---|---|---|
| £100 | £18 | £118 |
| £250 | £45 | £295 |
| £500 | £90 | £590 |
| £1,000 | £180 | £1,180 |
What about VAT?
VAT is charged on the hammer price only for lots marked with an asterisk (*) in the catalogue, as set out in our Conditions of Sale. The vast majority of lots in our sales, being second-hand goods from private sellers, are not marked. If a lot is marked, the VAT is shown on your invoice separately. If you are ever unsure about the total for a particular lot, ask us before the sale rather than after.
Why do auction houses charge a buyer’s premium?
The buyer’s premium is standard practice across the UK, from small regional salerooms like ours to the big London houses, and the larger houses generally charge a good deal more than we do. It allows the auction house to keep the seller’s commission at a level that encourages people to consign good items, which in turn means a better sale for buyers. The premium helps cover:
- Cataloguing and photography — Accurate descriptions, condition reports and images for every lot.
- Marketing — Promoting each sale to attract as many bidders as possible.
- Saleroom facilities — Viewing days, storage and sale-day operations at 1 Station Road.
- Online bidding — The live streaming and bidding platform that lets you bid from home.
- Insurance — Cover for items while they are in our care.
- Staff expertise — Auctioneers and valuers who research, catalogue and answer your questions.
Bidding with the premium in mind
- Work backwards from your total. If you are happy to spend £118 all in, your maximum hammer bid is £100. Divide your total budget by 1.18 to find your top bid.
- Check the rate wherever you bid. Premiums vary between auction houses and sometimes between sales at the same house. Ours is 18% everywhere, but do not assume that elsewhere.
- Look for the asterisk. If a lot is marked (*), VAT will be added to the hammer price as well.
- Compare the whole cost. Even with the premium, auction prices for antiques and collectables are very often below what the same piece would cost in a shop.
Is the buyer’s premium refundable?
Only in one circumstance. Lots are sold as seen and there are no returns for a change of mind, but if a lot proves to be a deliberate forgery as defined in our Conditions of Sale, it can be returned within 10 days of the auction and we refund the full amount paid, including the premium.
Start bidding at Clumber Auction House
Browse our upcoming auctions and register for free. New to auctions? Read our complete guide to how auctions work or contact us with any questions. We would rather explain something twice than have you surprised by your invoice.
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