Lee Pitts: It’s the Pitts
I’ve helped sell at auction a $10,000 bottle of wine, a million dollar house, a $350,000 cow and a $4 sheep. At auctions I’ve worked we’ve sold everything from a tractor that didn’t run to a race horse that did. We sold a llama that spit all over my tuxedo and an ostrich that pecked on me because the dumb birds like bright and shiny objects. I’ve helped sell modern art that you couldn’t tell which way was up and a VW hippie bus that you didn’t know if it was coming or going. In other words, when it comes to auctions I thought I’d seen about everything there was to see. But that was before my curiosity compelled me to attend a ranch real estate auction conducted by a big city auction firm.
My rancher friends had been trying for a few years to sell a couple ranches that didn’t bring in enough net proceeds to pay the property taxes. So my friend came up with the idea of exposing the picturesque ranches by offering them for sale on eBay. Sure enough, they got a lot of attention, including that of a huge real estate auction firm that has sold buildings and land in every state of the union and six foreign countries. But before the firm would even consider selling the ranches my pals had to pay them $180,000, which was not refundable. They’d get another $420,000 when the deal was done. That’s mighty good work if you can get it!
On sale day we all gathered at a beautiful resort where a piano player serenaded everyone with Brahms and Beethoven and a banquet room was full of 17 millionaires and a big bunch of cowboys dining on finger food. The auctioneer was witty, personable and had the chant of a student after his first day of auction school. But he was as persuasive as a pair of Chihuahua spurs with 4-inch rowels. He announced that at the end of the proceedings the two ranches would have new owners and that it was an “absolute auction.” Sort of!
First the auctioneer had everyone participate in a practice auction which turned out to be very much like the real auction. Then we had the actual sale. The auction consisted of two neighboring ranches and first he sold “choice” in which the winning bidder could take his pick of the two. Then he “sold” the other ranch by the acre, and then he “sold” the two ranches as one. I used quotation marks because even though real bidders bid a lot of real money nothing had actually “sold” yet for the auctioneer then announced that there would be a 10 minute recess while the piano player played more pretty music. After the time out, anyone could then reopen the auction by bidding 5 percent more than the earlier “winning” bids.
This guy was more creative than my accountant!
Sure enough, after further consideration someone wanted to pay too much for an unprofitable cow ranch, so the whole process was repeated. I swear, we’ve sold 100 head bull sales in less time that it took to sell those two parcels! One person then “bought” one ranch, another bidder “bought” the other and then both of them lost their new ranches when yet another person “bought” both ranches. I put parentheses around “bought” because the ranches still weren’t sold because they had to survive a 30-day escrow where the whole thing could fall apart. By now, the cowboys in attendance were really shaking their heads and wondering, “Is this any way to run an auction?”
Can you imagine if we sold cattle this way?
A cow and her calf would enter the sale ring and the “buyers” could take their pick of the cow or the calf. Then the other would be sold. And then the two of them resold as a pair. There’d be a 10-minute recess as classical music would reverberate in the auction barn and the cow buyers would dine on free finger food. Then the whole auction would be repeated. But the pair of cattle still wouldn’t be sold because there’d be a 30-day escrow in which the cow, the calf, or both, could die. And who would pay the feed bill during that period? And there’s no way the consignor would pay the 10 percent commission the real estate firm charged. I guarantee there’d be a fist fight between cow buyers, pretty music or not, and just like the real estate auction, the cowboys in the crowd would be wondering what the heck had just happened?
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