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If you are considering hosting an estate sale, you are likely dealing with losing a loved one, downsizing, or, less commonly, simply looking to declutter. While an estate sale (and all that comes with it) can seem overwhelming initially, it can also be a great way to sell your loved one’s possessions and clear out space.
This guide will provide an overview of the estate sale process, including how to choose a professional estate sale company—or host the sale yourself. Whether you are new to estate sales or have some experience, we hope this article will provide the essential advice to make the most of your estate sale.
What Is an Estate Sale?
An estate sale is a public liquidation sale that sells the belongings inside a property (a person’s estate). Anything from the cleaning products under the sink to the art on the walls can be sold in an estate sale.
There are several reasons someone might decide to sell their personal belongings, and most of them include some type of significant life change. Some include:
- Death in the family
- Downsizing to an apartment
- Debt that needs to be paid off, i.e., bankruptcy
- Divorce and a split of assets
In the case of a death, the individual’s will will dictate how the estate sale will run. Will heirs have the chance to pick items out before the sale, or will everything be liquidated and the cash split among the surviving family members? The situation can become stressful for everyone involved if the terms are unclear.
Types of Estate Sales
An estate sale company generally runs an estate sale, and they will have their own rules for how the estate sale will go. There are locally-specific regulations regarding permitting, marketing, and sales tax. (These rules may not apply if you host the estate sale yourself.) When dealing with a company, there are two types of sales you’ll run across as a seller.
In a partial estate sale, companies typically charge a 25-45% commission, covering marketing, staffing, and profit. Such sales might not encompass the entire estate but select items, especially if heirs wish to retain valuable pieces or some items aren’t fit for sale. The commission can vary based on the estate’s value and the preparatory work required. Ensure the company provides detailed receipts to validate the commission’s authenticity.
Understanding Estate Sale Commission Rates
Some estate sale companies offer a flat rate for an entire estate, handling the clearance of all items post-sale. This option is ideal for those seeking a quick sale without the hassle of unsold items. The company assesses the estate’s value and makes an offer, considering their expected costs and profit. Payment is usually in cash or check, helping the seller cover debts or expenses. The company manages the sale’s organization, advertising, and pricing. However, their offer might be lower than potential sale proceeds, so it’s wise to compare multiple offers before deciding.
How to Pick a Reputable Estate Sale Company
- Research online reviews. Look for reviews of the estate sale company on various online platforms, such as Google, Yelp, and the company’s own website. Pay attention to both positive and negative reviews to get a balanced understanding of the company’s reputation.
- Ask for references. Ask the estate sale company for references from past clients. Contact these references and ask about their experiences with the company.
- Check with the Better Business Bureau. Check the company’s rating and any complaints filed with the Better Business Bureau (BBB). While a lack of complaints doesn’t necessarily mean the company is reputable, a high number of complaints could be a red flag.
- Ask about their experience and credentials. Ask the estate sale company about their experience and credentials in the industry. Look for companies with a proven track record and experience in handling estate sales similar to yours.
- Consider the company’s policies and procedures. Review the company’s policies and procedures for handling the estate sale. Look for clear, fair, and transparent policies that protect your interests and provide good customer service.
Pros and Cons of Hiring an Estate Sale Company
Overall, hiring an estate sale company can be a convenient and effective way to handle the sale of a loved one’s estate. However, it’s important to weigh the pros and cons and carefully consider your budget and priorities before making a decision.
- Professional experience. Estate sale companies have the experience and expertise to handle all aspects of the sale, from pricing and organizing items to advertising and managing the sale itself.
- Time-saving. Hiring an estate sale company can save you a significant amount of time and effort, as you won’t have to handle the sale on your own.
- Maximum profitability. Estate sale companies know how to maximize the profitability of a sale and can often get higher prices for items than you might be able to on your own.
- Stress-free. This factor is arguably the most important. Dealing with the sale of a loved one’s estate can be emotionally and physically draining. Hiring an estate sale company can alleviate some of this stress, allowing you to focus on other important matters.
- Cost. Estate sale companies typically charge a percentage of the total sales, which can be a significant cost.
- Limited control. When you hire an estate sale company, you may have less control over the pricing and management of the sale.
- Limited flexibility. Estate sale companies often have strict policies and procedures that may not allow for much flexibility in terms of the timing or location of the sale.
Hiring a Company vs. Hosting an Estate Sale
Time & Effort: Do you have the time, energy, and expertise to organize, price, market, and manage the sale yourself?
Emotional Attachment: Can you objectively price and part with personal items, especially those with sentimental value?
Financial Expectations: Are you equipped to maximize profits and negotiate prices, or would a professional potentially yield a better return?
Weighing these questions can guide your decision and ensure you choose the best approach for your unique situation.
How to Do an Estate Sale Yourself
If you decide to host an estate sale at your home without a company, here’s what you’ll need to do:
- Price Items
Prior to the sale, appraise all items and come up with fair pricing. Have a price list ready for all items that will be for sale. It is important to have a clear pricing system in place to avoid any confusion or misunderstandings during the sale.
Before setting prices, research similar items online or consult with antique dealers to get a sense of their value. Remember, items at an estate sale are usually priced higher than garage sale prices but lower than retail prices.
- Hire Security
Consider hiring security or having a designated person responsible for keeping an eye on the house and any valuable items.
- Create Signage
Have clear signage directing buyers to the sale and indicating any parking restrictions or other important information.
- Advertise the Sale
Use local classifieds, online platforms like Craigslist or Facebook Marketplace, and consider placing signs in your neighborhood a few days before the sale. A well-advertised sale can attract more potential buyers.
- Set-up the Space
Make sure the house or space where the sale is taking place is clean and organized. This will make it easier for buyers to browse and shop. Group similar items together, use tables to display items at eye level, and ensure that everything is easily accessible. Consider using tags or stickers to clearly mark prices.
- Recruit a Sales Team
Have a team of people available to assist buyers and answer any questions they may have about the items for sale. Be ready for buyers to haggle over prices. Decide beforehand how flexible you’re willing to be and set a minimum price for each item.
- Figure Out Cash Handing
Have a designated person responsible for handling cash transactions. This person should have a secure place to keep the money, such as a cash box or register.
If applicable, make sure to collect and properly record sales tax on all transactions. If you are not a registered business, this may not be necessary. Check the laws in your state. Keep a record of all items sold and their selling prices. This can be useful for accounting purposes and for any potential disputes.
- Clean Up After the Sale
After the sale is over, be prepared to clean up any leftover items and properly dispose of them by donating or trashing them accordingly.
- Review Sales Receipts
After the sale is complete, make sure to account for all sales and payments. This will help ensure that any taxes or splitting of assets has accurate data.