The 101

 

You are starting the discussion of what to do with a house full of stuff.

 

Whether for you, your parents or you are an executor/executrix managing an estate, an estate sale can be a positive solution.  As with any undertaking, research is key to the success.   This page is meant only to offer a greater awareness.

 

In the broadest terms, an estate sale provides a profitable opportunity to clear out a lifetime of an accumulation of furnishings, décor and possessions.  As with any project, do your homework.

 

Up through the 1990’s, estate sales meant a once in a lifetime opportunity to find fabulous treasures in an affluent neighborhood.  Things have changed drastically.  American’s are living longer, families are seldom in the same city, downsizing is the new norm and for those that have passed away the families are burdened by the volume of goods left behind.  All of these changes have transformed the landscape of estate sales, who they service and what they offer.

 

Conducting estate sales is a serious business.  It is not an average weekend garage sale.  It is estimated, in the US, this industry has increased by 650% in the past ten years addressing more than $150M in sales each month.  At the end of 2019, Houston had approximately 100 estate sale companies listing their services. 

 

An estate sale company will organize, research, market and execute a sale clearing out what took a lifetime to amass.  Thus, allowing an empty house to be sold with both the client and the company profiting from the sale. 

 

To ensure a profitable sale, do your homework and know that a reputable company is not sitting around waiting for your call.  They are usually booked up weeks if not months in advance with other client commitments.  This is a good thing as you want a busy company, not an available hobbyist!  If you anticipate calling a company or two and have an immediate solution, you are setting yourself up for a disaster!!!

 

Homework steps! 

 

The First Step:

 

Does your neighborhood/community allow estate sales?

 

Many neighborhoods have Deed Restrictions which do not allow for estate sales, garage sales, yard sales and the like.  It is best to have a clear understanding of what is allowed before meeting with a company.  Most all Deed Restrictions are available through your HOA or online.

 

If restrictions exist, some companies may migrate the contents to another client home or conduct a Private Sale if appropriate.

  

The Second Step:

 

Educate yourself by visiting estate sales and looking for clues to a knowledgeable liquidator:

 

* Is there good signage leading shoppers to the sale?
* Is there good signage in the yard, at the door, inside the home?
* Is the staff friendly and welcoming?
* Are staff members easy to identify?
* How are the contents of the sale presented?
   * Are they clean?
   * Are they easy to access?
   * Are the contents organized or a jumbled mess?
   * Are the prices easy to locate on items?
* Is the sale well attended?
* How are purchases removed from the sale?
   * Are shoppers struggling to take items out or are bags/boxes provided?

 

At the end of each visit, ask yourself if this is a company you would want to represent your home and contents. If so, grab a card and call the company a couple of days after the sale has concluded and they’ve had a moment to catch their breath!

 

The Third Step:

 

Just as you would search out a good plumber, a qualified physician or a great mechanic do your due diligence and interview several estate sale companies.  There are major differences between companies based on experience and knowledge.  I would recommend interviewing three companies to determine which one best meets your needs.

 

Word of mouth is a trusted way to locate a reputable estate sale company or to rule one out. 

Ask friends, co-workers and neighbors for recommendations.  Look online and follow signs that may lead you to a weekend sale.

  

What I recommend looking for:

 

* A company that has been in the business for a minimum of four years under the same name. 
       More on that further down.
* A company that accepts credit/debit cards.
* A company that has an online presence.
* A company that can offer current and past referrals.
* A company that is booked in advance.

 

Questions to review during the interview:

 

* Who pays for staffing?
* Who pays for advertising and what does that include?
* Is there security and who pays for it?
* Who pays for credit card and NSF fees?
* When and how are you paid?
* Are they insured? 

 

The interview process will be done on-site, typically taking thirty minutes to an hour.  The company will look in all the cabinets, closets and corners to visually and mentally review the contents.

 

During this meeting, you will discuss the potential of a sale and schedules.

 

The Fourth Step:

 

Decide on a company, establish dates and sign a contract.

 

The volume and condition of goods dictate a majority of the preparation schedule.  Most estate sales will take from a week or two up to several weeks to prepare and execute a sale from beginning to end.  Preparing, researching, pricing, staging and executing a sale takes time.  Establish dates to provide house keys, sale dates and dates to retrieve keys with payment of the sale proceeds.

 

Read the contract thoroughly before signing, do not feel pressured to sign immediately.

 

Ensure the contract is professional, addresses all concerns and provides a Termination Clause.

 

Ask about insurance and bonding.

 

Insurance and Bonding are two completely different things.  I could state my thoughts and opinions, but here is an article on Angie's List which sums it up perfectly.

 

I am insured through ACNA, I am no longer bonded.
I found being bonded was an advertising perk more than a business benefit or necessity for this industry.

 

If a company has either, great?  If a company has neither, keep looking.

 

Client's are expected to have current Homeowner's Insurance. 

Why?  If there is an accident that is due to neglect within the home or property, the homeowner is responsible.   
I visited a house in Bellaire in 2015.  The first three treads on the staircase had serious issues.  The client was not interested in making small repairs. However, with a packed house the second floor was a necessity.  With a dangerous staircase, I turned the sale down.  For me, it was a safety issue and not worth the risk to anyone.

 

Note Regarding Commissions and Contents:

 

It is understandable that one of the first questions typically asked over a telephone conversation is "what is your commission?"

 

Just as a mechanic cannot provide you with a quote over the phone when you explain there is a noise under the hood, I will not quote a commission until I have seen the home, the contents, the condition, the quality and the quantity to determine the manpower required for the project.  The greater the manpower required, the greater commission typically.

 

A hoarder’s house will require far more time and effort than that of a minimalist. 

 

Do not choose a company based on a lower commission.  The adage “You get what you pay for” applies here and can be the difference in netting you thousands of dollars. 

 

The estate sale company you will hire has accepted the sale based on the projected commission of ALL the contents that were discussed to be in the sale.  If those with keys to the house (homeowners, family, neighbors and friends) begin to "shop" the house, the company has the right to charge full commission on the items that have left the home.

 

Furthermore, the company has the right to walk away from the sale if the remaining contents do not provide for a financially successful sale.  This is a business and as such must be profitable.

 

Special Note on Emergency Estate Sale Commissions. 
For whatever reason, you need an estate sale now....waiting is simply not an option.  You can expect to pay a much higher commission for a company to reschedule other client commitments to accommodate your immediate needs.  

 

The After Sale Step:

 

Not everything will sell. 

 

Determine prior to the sale what you believe you wish to do with non-sold goods.  Once the sale has concluded, walk the house and review your plan.

 

Clean Out Services address the non-sold goods where companies will pack and donate these goods.  Some companies offer this as part of their commission package, some companies offer it as a fee-based service and some companies do not offer it at all.

 

There is no right or wrong.  As the client, you simply need to know what to expect and plan accordingly.

 

They Said No!!!

 

You want a particular company to conduct your sale....but they said no!!!

 

A company typically declines a sale for one of four reasons: location, scheduling, financial or a challenging client. 

 

Location - If the client home is too great a distance for all to travel to and from daily, if the location is cumbersome for shoppers to either park or walk to or there are deed restrictions, the company will decline.

 

Scheduling - A sale takes time from start to finish, the more stuff – the longer the process.  Be aware of your scheduling needs and the liquidators schedule.  I decline sales almost daily for those assuming I am immediately available. 

 

Financial - Companies have staff and assorted costs/business expenses.  For that reason, companies have a minimum that a sale must gross.  If the company determines that the sale would not be profitable, they will decline.

 

Challenging Client - For those of us who do our job well, we are fortunate that we can be selective and by design of this business we must be.  Challenging clients include those who are too emotionally attached to the contents to move forward; clients that believe the contents have a far greater value than what the secondary market currently offers; clients who want a sale conducted only on their terms without the knowledge of the liquidation industry and clients who simply make everything in life difficult!

 

To Ensure A Good Sale:

Throw nothing away!  Give nothing away!
Seriously.

 

Focus only on what you and yours wish to keep, leaving all other goods in place.  The company you hire will determine what is sellable and what is not.

 

Examples of what you might think you should toss, but shouldn't:

  

Notify all family and friends so they can spread the word about the upcoming sale.

 

Leave all utilities on, manuals and receipts in a central location,

 

If the home is for sale, have flyers/information available to hand out.

 

BIG UGLY RED FLAGS

 

Within any industry, there are disreputable companies/individuals.  One more area to research!  

 

On any given weekend in the Greater Houston area, there are more than two dozen estate sales being conducted.  If the companies are all competing for the same shoppers' dollar, what sets them apart to ensure the shoppers come to your sale?

 

What to know and be suspicious of:

• A company that has changed their name.
  They're dodging something, hence the reason I indicated earlier that you should look for a company that has been in business for four-plus years with the same business name.
• Their website does not list the company owners by first and last name.  If they are not proud of their business, do not give them yours!  
  
  There are several companies here in Houston where owner names are not listed as they are wanted by the law! Scary but very true!  Local consumer reporters have tracked them down. Their reports are all online, just research, research, research!  In late 2019 one of the company owners was finally tracked down and sentenced to two years for felony theft.
• No online presence, no pictures or fuzzy/dark pictures.  This is a professional business.  Websites have now existed for decades. If they are not competing at a professional level, they are not providing you with the best services commonly available. More on photography below.
• Change Locks.
  If the company wishes to change the locks, ensure you have a new key and you can visit at any time.  It is your house and your belongings!
• Cash / Venmo / Zelle Only
  If they only accept and advertise as a cash only sale they are tremendously limiting your revenues, limiting who will attend the sale and advertising to crooks there is a stash of cash on site!
  
  Example - a common item in all sales is a dining room table minimally priced in the hundreds.  If an interested shopper arrives without cash, they leave without a dining room table.  Running to the ATM to get the cash is not always a solution.
  
  Cash Only Type Sales are perfect for Garage Sales, but not for Estate Sales with quality contents.
• Convenience Fee
  Some companies will charge their shoppers an extra fee to use a credit card for purchases.
  Credit Card Fees are a business expense that can be deducted.  The estate sale company may not have a CPA, may not be aware of this.....or......is greedy!
  In any case, it is unprofessional and in Texas - illegal.  

  States that prohibit credit card surcharges and convenience fees

  Ten states prohibit credit card surcharges and convenience fees: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas. It is illegal for merchants to add any surcharges to credit card transactions or charge convenience fees to nontraditional payment methods in these states.

• Bad or Misleading Advertising Terms
  
  'Priced To Sell' - if it isn't priced to sell, what is it priced for?
  
  'Family Gave Us One Day' - so, the family is managing the liquidator's schedule?
  
  'Short Notice' - No one planned and the company was available?
• Do They Have A Booth?
  If they have a booth at an antique mall or similar venue, how do they obtain their inventory?  This could be a HUGE conflict of interest.
   
• Quantity of Sales.
  Some companies boast of the number of sales they conduct per year.
  
  There is a huge difference between quantity and quality in the execution of sales.  If the business model of any given company is to conduct multiple sales on any given weekend, when do they have time to research the best prices for your contents?
   

One Last Ramble

 

I began conducting sales in 2002.  At that time, there were less than twenty companies in Houston conducting estate sales.  Currently, there are one hundred companies.

 

Two things to help you narrow down your options:

 

Google the company.

There are several companies that have sadly made the local news for consistently not paying homeowners after the sale; companies that change the locks on a house and all the contents disappear; companies that have accurately earned negative reviews on a variety of websites and companies that are being managed by ex-cons.

 

While information is not always accurate online, consistency in what you read will better prepare you.

 

Review company details on listing sites.

Specific websites (estatesales.net, estatesales.org, estatesale.com) exist solely as a listing site for estate sale companies to market themselves and their upcoming sales.  Within these sites, company details can be located. 

Estatesales.net has existed the longest of these sites, over 10 years at this point, they list the length of membership of companies.

 

I would recommend focusing on companies that have been a member for 4+ years.

Do not focus on their name or the order they are listed.  
Focus on tenure.  If they have made it at least four years, in theory, they are a legitimate company and not learning the ropes by conducting a sale at your expense nor have they changed their name to hide from their previous actions.

 

Note - While these sites are exceptionally useful, they are in business to make money.  Period!
Historically they have not reacted to legal complaints of poorly managed companies and seldom do they retract a company from their listings.  In other words - it is not their intention to protect consumers from the various illegitimate companies that utilize their services.  

 

Articles

 

Here are links to give food for thought when considering estate sales:

 

Wall Street Journal

Washington Post
Forbes
New York Times
Estate Sales News  a great website offering information on estate sales. 

 

Photography

 

There is a younger generation shopping estate sales more than ever these days. They are completely aware that older furniture is made well, made to last.  Their mindset is reuse, recycle and repurpose.  While they may not care for the dark brown finish on a table, they need the table as the older shoppers do not.  Older shoppers have a house full of furniture!

The younger generation is going to buy, strip, stain or paint that table then boast to their friends the deal they got.  Introducing other younger shoppers to estate sales.

In other words - someone in their 50's doesn't usually need living room furnishings while someone in their 30's does.  Why is this relevant?

Someone in their 30's shopping for furniture first goes online.  It is second nature. They are leashed to technology and use it to their advantage.

If you were in their shoes shopping for a sofa, and have a small budget, are you going to view a sale where there are no pictures to represent the contents or will you quickly, with your smartphone in hand, move on to look at the next sale?

Who a company markets will impact who shops the sale.  By minimizing their marketing efforts, they minimize your revenue.