Property Auctions - Glossary

Absentee bid	An absentee bid is procedure which allows a bidder to participate in the bidding process without being physically present on auction day. Generally, a bidder submits an offer on a property prior to the auction. Absentee bids are usually handled according to an established set of guidelines by the auctioneer or his representative. Ask Colliers Auctions for further information on our rules and procedures for absentee bids.
Absentee bidder	A person (or entity) who does not attend the sale but submits, in advance, a written or oral bid that is the top price he or she will pay for a given property.
Accounting of sale	This is the report that Colliers Auctions gives to the seller and which outlines the financial aspects of the auction.
Agent	A person who acts for or in the place of another individual or entity by authority from them.
Appraisal valuation	The act or process of estimating the value of the property.
As is	The property is sold as seen without warranties in terms of the condition and/or the fitness of the property for a particular use. It is the buyer’s responsibility to examine the property prior to the auction. Selling a property as is, is also referred to as where is or in its present condition.
Auction listing agreement	This is the contract between Colliers Auctions and the seller which authorises us to conduct the auction. It also sets out the terms of the agreement and the rights and responsibilities of each party.
Auction price	The price of a property obtained through the auction method of marketing.
Auction value	The price which a particular property brings in open competitive bidding at public auction.
Auction with reserve	This is an auction where the seller or his agent reserves the right to accept or decline any and all bids. A minimum acceptable price may or may not be disclosed and the seller reserves the right to accept or decline any bid within a specified time.
Ballroom auction	This is an auction of one or more properties conducted in a meeting room facility.
Bank letter of credit	This is a letter from a bank or financial institution certifying that a named person has credit up to the amount stated.
Bid	A prospective buyer's indication or offer of a price he or she will pay to purchase property at auction. Bids are usually in standardised increments established by the auctioneer.
Bid acknowledgment	A form executed by the high bidder confirming and acknowledging the bidder's identity, the bid price and the description of the property. This is also known as a memorandum.
Bid rigging ringing	The unlawful practice whereby two or more people agree not to bid against one another so as to deflate value.
Bidder number	The number issued to each person who registers at an auction.
Bidder pack	The package of information and instructions pertaining to the property to be sold at an auction event obtained by prospective bidders at an auction. This is also called a bidder package or due diligence package
Brochure or catalogue	A printed brochure advertising and describing the property available for sale at public auction. This brochure usually includes a description of the property, photographs, and the terms and conditions of the sale.
Carrying costs	The costs involved in holding a property which is intended to produce income (either by sale or rent) but has not yet done so. Carrying costs include insurance, taxes, maintenance and management fees.
Commission	This is the fee that the buyer (or seller) must pay Colliers Auctions for its services. This commission is usually a fixed percentage of the selling price of the property established by contract (the listing agreement) prior to the auction.
Conditions of sale	The legal terms that govern the conduct of an auction, including acceptable methods of payment, terms, buyer's premiums, possession, reserves and any other limiting factors of an auction. The conditions of sale are usually included in published advertisements or announced by the auctioneer before the auction starts.
Due diligence	The process of gathering information about the condition and legal status of assets to be sold.
Estate sale	The sale of property left by a person at his or her death. An estate auction can involve the sale of personal and/or real property.
Hammer price	Price established by the last bidder and acknowledged by the auctioneer before dropping the hammer or gavel.
Listing broker	A real estate broker who has a listing on a property and cooperates with the auction company by allowing the auction agreement to supersede his/her listing agreement.
Market value	The highest price in terms of money which a property will bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus.
Minimum bid auction	An auction at which the auctioneer will accept bids at or above a disclosed price. The minimum price is always stated in the brochure and advertisements and is announced at the auctions.
Minimum opening bid	The lowest acceptable amount at which the bidding must commence.
Multi-property auction	A group of properties offered through a common promotional campaign. The properties to be auctioned may be owned by one seller or multiple sellers.
Multi-seller auction	Properties owned by many sellers, offered through a common promotional campaign are auctioned in a single event.
Opening bid	The first bid offered by a bidder at an auction.
On-site auction	An auction conducted on the premises of the property being sold.
Preview	This is the specified date and time property is available for prospective buyer viewing and audits. Also known as open house or inspection.
Regroup	A process used in real estate auctions where the auctioneer has the opportunity to combine several parcels of land previously selected by other bidders in order to create one larger parcel made up of several smaller parcels. This process is often used in conjunction with bidder's choice.
Reserve price	The minimum price that a seller is willing to accept for a property to be sold at auction. If the bidding does not reach this price the seller does not have to accept the highest bid.
Sealed bid	A method of sale where confidential bids are submitted to be opened at a predetermined place and time. Not a true auction because it does not allow for reaction from the competitive market place.
Terms	The period of time that an agreement is in effect.
Terms and conditions	The printed rules of the auction and certain aspects of the Purchase and Sale Agreement that are read and/or distributed to potential bidders prior to an auction sale.
Tie bids	When two or more bidders bid exactly the same amount at the same time. This must be resolved by the auctioneer.
Trustee's sale	A sale at auction by a trustee.
Winner’s curse	This is when the winning bidder ends up paying more for property than what the actual value of the property is.
Withdrawal	Certain properties can be withdrawn from auction due to various reasons.