How Do Estate Liquidators Work?
Most estate liquidators have one main objective: liquidate everything in your home. Estate liquidators want to earn the largest possible amount of money through the sale of the estate’s items in a short period of time.
The estate liquidation industry has evolved over the years. Some estate liquidators have different specialties, while others build their business models around a particular way to liquidate. Hybrid estate liquidators have also started to emerge.
Here are the five types of estate liquidation companies you will most likely encounter:
- Traditional estate liquidators conduct onsite liquidations where customers can walk through a house and buy items.
- Estate auction houses bring entire estates (or specific pieces from an estate) to an offsite location to auction them off. Some auction houses specialize in high-end liquidations, featuring items like fine art and luxury furniture, etc. Mid-range liquidations frequently include cars, guns, etc.
- Estate auctioneers liquidate estates onsite at the home. They are similar to the traditional estate sale in their offerings, but the merchandise is auctioned off rather than priced individually.
- Hybrid estate liquidators conduct both auctions (usually online) and estate sales depending on the type of estate, what’s included in the estate, and the client’s specific needs.
- Estate liquidators with an auction-house partner will conduct traditional estate sales but use an auction house for certain big-ticket items like priceless pieces of art, high-end furniture, etc.
A few more differences include:
- Estate liquidators will try to sell as many of your items as they can for the best price possible.
- Traditional estate sales usually last one to three days, and prices are determined by the estate sale company. Most estate sales are discounted as the sale progresses.
- At an estate auction, which typically only lasts one day, the prices are determined by the buyers, through the bidding process.
Regardless of format, what happens when you hire an estate sale company is pretty much the same across the board. Estate liquidators will:
- Stage and price the sale, either by taking the items offsite and displaying them in their showroom or by setting up tables in your home. Depending on the condition of the home and how much there is to sell, this can be a time-consuming job. The items must be unearthed, evaluated, inventoried, and priced.
- The estate sale company will also advertise the sale and put up the necessary signage. Management of the sale and post-sale clean-up will follow. Most companies will also arrange for the donation of unsold items and complete a trash removal if requested.
Estate Sale Cost
Most estate liquidators operate on a commission basis. Money is made as items sell. Gross incomes vary from sale to sale but the average estate sale grosses over $18,000. Keep in mind estate sale revenue have many variables that affect the end result of how much estate liquidators charge.
In addition to commission, some companies include other estate sale fees such as trash hauling and advertising.
Hiring the estate sale company with the lowest estate sale commission rate might not mean you’ll be getting the most money in the end. A seasoned estate sale company could have a 50% commission rate, but they offer years of practice, know-how, an established customer base, and relationships with brokers and auction houses—which could mean more money for your estate items. You may also consider an estate sale company with a lower commission rate such as 25%, but a lower estate sale commission rate may mean you’re working with a less-experienced company.
You might also want to ask the estate sale company what they expect the sale to gross. However, you must consider some margin of error as many variables can affect the outcome of a sale, from the merchandise to the weather.
So how much does it cost to hold an estate sale? As mentioned, there are many variables – it depends on who you hire, what you’re selling, how many people attend the sale, the parking situation in your neighborhood, etc. How much your estate sale will make and the commission the estate sale company makes are difficult to predict. Finding the best estate sale company for you and your situation is the most important consideration. Ultimately, you should choose the one you feel most comfortable with.
How Much Do Estate Liquidators Make?
Most estate liquidators work on a commission and charge you a percentage of the estate sale’s gross profits. Estate sale commission rates may vary for each different estate sale and may even vary depending on where you live. As an example, a company might charge you an estate sale commission rate of 35%. So if the estate sale grosses $10,000, you’ll owe them $3,500.
Some estate liquidators may have optional services they provide at additional estate sale fees, such as trash removal or post-sale clean-up. When you are getting quotes from potential estate sale companies, ask about these additional estate sale fees. Ask how these fees are calculated and ask what they normally amount to for the average estate sale. This will give you an idea of how much you might have to pay.
When determining how much the estate sale company is going to charge your sale, they generally draw from one of these three different approaches:
1. Set percentage: The estate sale company determines a set percentage of gross sales for their estate sale services and that’s what they take for every sale, regardless of size, complexity, etc.
2. Sliding scale: The estate sale company determines its percentage based on the total gross sales. For example, the higher the sale grosses, the lower your percentage may be. Here is an example of how an estate sale company might structure its sliding scale:
Estate Sale Gross Total Percentages:
- $5,000 – $10,000: 50% estate sale commission rate
- $10,001 – $15,000: 45% estate sale commission rate
- $15,001 – $20,000: 40% estate sale commission rate
- $20,001 – $30,000: 35% estate sale commission rate
- $30,001 or more: 30% estate sale commission rate
3. In-person estate sale evaluation: This is perhaps the most common method of determining estate sale company fees. In order to understand this approach you’ll want to know what the estate sale company is looking for during the walk through. Most are looking at two major factors: the amount of work required and the value of the estate.
The amount of work required is determined by how many hours the estate sale company thinks they’ll need to put into your sale, including setup, pricing, running of the sale and post-sale duties such as donation, trash removal, and cleanout. If you are liquidating the estate of a hoarder, the company will need to spend a lot more time and effort sorting, pricing, and staging the items in the home. These sales often require many more days as well. Conversely, you may be liquidating an already-staged home that simply needs to be priced. This takes significantly less time. The more work that needs to be done to prepare for the sale, the more you will pay in estate sale fees. Vastly effecting how much estate liquidators charge.
In addition, the estate sale company will need to consider what the estate is worth. If an estate sale company comes into the home and finds items such as fine art, a collection of jewelry, designer furniture, and large power tools, they are going to want to manage your estate sale knowing it will be very profitable. Because of that, they may actually offer you a lower estate sale commission rate in order to win your business and outbid other estate companies. If they see a lot of damaged furniture or old clothing, estate liquidators charge you a higher estate sale percentage, as the lower-value items mean they’ll be making less money for the same amount of work.
Go with the Estate Pros!
The Estate Pros are consistently ranked amongst the top estate liquidators in America as recognized by EstateSales.net, EstateSale.com and others. We specialize in working with families and individuals who are in need of residential liquidation, donation, cleanout and personal property appraisal services.
The Estate Pros are an estate sale industry authority with hundreds of years of combined experience amongst our ownership and staff. Our owners, sales team, and support staff are held to the highest standards of professionalism and service. We treat each of our clients and shoppers with the utmost care, compassion and respect. Learn more about all of our Estate Sales services.
The Estate Pros pay meticulous attention to detail as we handle every aspect of the estate sale process from start to finish. Our experts will work with you from the initial free consultation to the complete execution of your event and everything in between.
You don’t need to lift a finger; we take care of everything for you! Thinking about hiring an Estate Sale Company? Contact the Estate Pros!!!
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