Opening price and estimate

What is the opening price and what is the estimate?

The opening price is the figure at which the bidding starts, the lowest offer from which bidding proceeds. The estimate is the expected range of a work's value, which the house publishes in advance — abroad as a pair, the low estimate and the high estimate. One figure opens the sale, the other suggests where it might end up.

How does it work in practice?

In the Czech Republic the opening price is deliberately set roughly 20 per cent below the value. This is neither an accident nor an underestimation of the work; it is a tactic for getting the bidding going and attracting more people to that first bid. The estimate range then serves as a guide to what could reasonably be paid for the work.

Why does it matter to a buyer?

Because from these figures you can read how much people wanted the work. The ratio of the final price to the low estimate is an excellent indicator of interest. When a work sells far above estimate, there was a real battle in the room; when it ends at the lower boundary, interest was cooler.

Can you give an example?

Say a house gives an estimate range for a work and sets the opening price just below its lower boundary in order to get the bidding going. If the final price ends up somewhere above the high estimate, that is a clear signal of great demand for the work. So the range and the starting figure are not a formality but a small forecast of how things will go.

What should you watch out for?

Do not take the opening price as the real value of a work; it is set low on purpose, to entice. The estimate range is a more realistic guide, and even that is only the house's qualified estimate, not a guarantee. The last word always belongs to the room and to what people are willing to pay on the day.

— Anna Pulkertová, founder of Art Part Club