Definition
The seller's commission is the percentage of the hammer price that the auction house retains as its fee for conducting the sale. According to an EstateSales.org industry poll, estate sale commission rates range from 25–50%, with 45% being the most commonly reported rate. For consignment auctions, the rate is typically 20–30%. The commission is deducted from the seller's proceeds — the seller receives the hammer price minus the commission.
How It Works
The seller receives the hammer price minus the commission. For example, if a lot sells for $1,000 and the commission rate is 25%, the auction house keeps $250 and the seller receives $750. Combined with the buyer's premium — a separate fee paid by the buyer on top of the hammer price — these two fees are how auction houses generate revenue. Some auction houses also charge additional fees for photography, cataloging, advertising, insurance, or moving and storage. Commission rates are typically set in a consignment or estate sale agreement signed before the auction. For a full breakdown of pricing models, see How to Price Estate Sale Services. Rates may be negotiable for high-value estates or ongoing consignment relationships, and some auctioneers use sliding scales where the rate decreases as gross sales increase.
Related Terms
See also: buyer's premium for the fee paid by the buyer on top of the hammer price; hammer price for the final bid price before any fees; consignment auction for auctions where individual owners place items for sale. For guidance on starting an auction business and setting commission rates, see How to Start an Estate Sale Business and The Real Cost of Manual Auction Cataloging.
Frequently Asked Questions
What is a fair auction commission rate?
For estate sales, 25-35% is standard.
For consignment auctions, 20-30% is typical. The rate reflects the auction house's services: marketing, cataloging, photography, conducting the sale, and handling payment. Higher-value estates may negotiate lower rates, while full-service auctions (where the auctioneer handles cleanout, sorting, and hauling) often justify rates at the higher end.
Who pays auction commission — buyer or seller?
The seller pays the commission, which is deducted from the hammer price.
The buyer pays a separate fee called the buyer's premium, which is added on top of the hammer price. These are two distinct fees: the commission comes out of the seller's proceeds, while the buyer's premium is an additional cost to the buyer. Together, they fund the auction house's operations.
Is auction commission negotiable?
Often, yes.
Commission rates are typically set by contract before the sale, and many auction houses will negotiate for high-value estates, large-volume consignors, or ongoing business relationships. Some auctioneers use sliding scales — for example, 30% on the first $50,000 in sales and 20% above that. Always ask about the full fee structure, including any additional charges for photography, advertising, or insurance.
Sources
- Technavio, "Online Auction Market Growth Analysis." technavio.com