In a time when more and more Americans are living paycheck to paycheck, the initial investment required to break into the storage auction market (albeit relatively small) can be enough to dissuade the average person from taking the leap. For veterans of the auction industry, this is perfectly alright. In the under-capitalized market of storage auctions, reluctance on the part of the American public means open season for storage auction insiders.
In truth, the storage auction industry is not the exclusive territory of high stakes risk-takers. Every new venture comes with some degree of risk, and the storage auction business is no exception, but don’t make the mistake of assuming that you need to have a huge reserve of cash at your disposal to break into this market. If you’re hesitant to take the plunge, take a page from the conservative investor’s playbook and start out in the kiddie pool.
The conservative auctionee bases his bids on what he knows to be true about the re-sale value of objects. Think of this as the “Price Is Right!” approach. Each bin will contain at least a handful of unboxed items for instant appraisal, so when the unit doors go up take a visual inventory of the contents and note the re-sale value of each visible object. To get an idea of an item’s current going rate, spend some time surfing the For Sale section on Craigslist and make a list of approximate re-sale values for a variety of items. Also check out the completed listings on eBay by clicking the Advanced link on the top of their homepage. Enter keywords to pinpoint specific items or categories (For example, “DVD Player”) and select the Completed Listings option to generate a detailed list of items sold in the past 15 days.
Once you’ve familiarized yourself with average re-sale prices, you will be able to determine the value of a unit more quickly and with greater certainty. Base your bid amount on the estimated re-sale value of each unit, without speculating on what might be hidden in boxes or bags. Whatever they hold can be thought of as an added bonus.
With this realistic approach to bidding, you can build your auction portfolio with the assurance that the return you see will at the very least make up for you initial investment.