An estate sale is an organized liquidation of the possessions of someone who is recently deceased. The executor of a Last Will often arranges an estate sale to disperse the assets of the deceased to his or her heirs, or to raise capital to pay outstanding debt being held against the estate.
Estate sales may also be used by people who need to sell their personal property so they can move into a new residence that can’t accommodate their worldly goods. A common example of this is when someone moves into hospice care or an assisted-living facility.
Estate sales are sometimes held by divorcing couples who want to sell their joint possessions and split the cash as part of a Separation Agreement. This scenario also applies to people who have gone bankrupt, and must liquidate their physical property to pay their debts.
What types of estate sales are there?
There are two main types of estate sales. An estate sale can be a DIY event—a solution that works best with a modest number of items. Bigger estate sales are often outsourced to a company specializing in arranging, advertising, and holding liquidations of large volumes of personal possessions. The company typically takes a percentage of the total sales, giving it an incentive to sell as many items as possible.
The format of an estate sale is sometimes similar to a garage sale; everything has a price tag on it, and some dickering over prices is expected. Or, the estate may be sold by an auction process, where people bid on each item or groups of smaller items.
How does an estate sale work?
Before an estate sale is held, the following tasks must be completed:
- Decide which items will be offered in the sale.
- Create an inventory of the items being sold.
- Determine an asking price for each item.
- Tag the items and properly display them around the site of the sale.
It’s not difficult to imagine how a large house filled with a lifetime’s accumulation of items could easily overwhelm the executor of an estate. This is why professional estate sale agents are often preferable to the DIY route in these instances.
An estate sale company will often send out an appraiser to assist in determining fair market prices for more valuable items like jewelry, antiques, and art items like sculptures and paintings. An estate sales agent will help the sellers to arrange items to make them more appealing to potential buyers. Some agents even provide display cases to give the sale a more professional appearance.
In the days leading up to the sale, the company will promote the event on its website. People who love attending estate sales will check these company sites for the dates and locations of upcoming events. The company may also advertise the sale in local newspapers, and hand out brochures in the neighborhood where the home is located.You should research estate sale companies online. Click To Tweet
On the day of the estate sale, the company will have staff onsite to perform the following tasks:
- Manage the front door by admitting limited numbers of buyers in an organized manner.
- Monitor buyers as they move through the home, answering questions and ensuring nothing goes missing.
- Process customer purchases; most experienced estate sale customers know that cash is preferred, but some companies can provide onsite payment options for debit and credit cards.
- Help the owners to tidy up at the end of the sale.
Finally, the estate sale company will provide the owners with an inventory of the items which sold, the total amount of cash raised, and the net profit after the company takes its cut.
In an estate auction, the company will either provide a live auctioneer to sell items, or host a silent auction where buyers submit their bids on paper forms, and the highest submitted bid wins the right to purchase the item.
How should I choose an estate sale company?
You should research estate sale companies online, comparing their rates and the level of service they provide. Make sure the company you’re interested in is bonded, which protects you in the event of a breach of contract or theft of items.
It is also a good idea to ask the company to provide references from previous customers, and to speak directly to one of them to ask questions about their estate sale experience.
As with any other service, you get what you pay for when it comes to estate sale companies. If a company takes a lower percentage of the total sales, chances are they will not offer add-ons like advertising, appraisal services, display cases, or buyer payment options other than cash.
Estate sales are a solution for many different situations
Whether you are the executor of a Last Will, a separating couple looking to split assets, someone moving into an assisted-living situation, or you need to liquidate your personal property to pay off debts, an estate sale could be the best way to get the job done. Estate sales can be simple DIY affairs or professionally arranged events, making them a flexible solution for any amount of property you wish to sell.
Have you ever been to an estate sale?