What is a reserve price?

A reserve price is the confidential minimum the seller will accept for a lot. If bidding doesn't reach it, the lot doesn't sell.

How it works

The seller and the auction house agree a reserve before the sale. It isn't published. If the bidding stops below it, the lot is "passed" or "bought in", and nobody pays anything. Lots with no reserve are normally marked as such, and will sell to the highest bidder whatever the price.

How it relates to the estimate

Many UK auction houses say in their terms that the reserve won't be set above the low estimate, and some say it can be at or below it. That's useful: if you bid up to the low estimate, you have a real chance of winning. Check your auction house's own terms, as they differ.

Why a rising price doesn't always mean other bidders

Auctioneers can often place bids on the seller's behalf up to the reserve, if the terms allow it. So the early bidding on a lot may be the auctioneer rather than competing buyers. It's one more reason to decide your limit in advance and not let the room set it for you.

What if the reserve isn't met?

You can ask the auction house after the sale whether the lot is still available. Sometimes it can be bought at or near the reserve, though there's no guarantee.

What the reserve really costs you

The reserve is on the hammer price, not the total. If a lot is estimated at £800 to £1,200, the cheapest you could expect to win it for is around £800, and with a 20% premium plus VAT that's:

General information only, not tax or financial advice. Auction houses set their own fees and terms, so always check the conditions of sale and confirm the details with the auction house before you bid.