Considering Buyer's Premium into Values of Cards / Memorabilia
 

Just wondering what some of my fellow collectors think: When you buy a card or piece of memorabilia from an auction house, do you take the buyer's premium into account when condidering the true value of the piece?

Ex. "Book" value of a certain card = $1,000. Recent copies of the card have averaged $950 with an average 17.5% buyer's premium at auction, so it costs (on average) $1,116.25 to get said card. To you, does this make the true value of the card $1,116.25? (Of, course, I'm not taking into account exraneous stuff, like sentimental value or the sporadic outlier).

This level of math is usually above my head, btw

Jason

For me yes.

100% matters - I consider all money out of my pocket (premiums, shipping) as the cost of the card to me.

If the auction house charges a 20% premium, you better realize that your $500 bid means you'd be paying $600 + shipping. And to me, I have a figure in my mind that I'd pay for an item; if that number is $500, then I prepare accordingly (an eBay bid of $500 might be only a $425 bid with an auction house which has a premium).

VCP prices include auction house buyer's premiums as well.

of course this has to be factored in...it is part of the total cost, right?

When you sell the card do you consider as part of your basis for tax purposes the buyer's premium?

I mean assuming you ever declare profits or losses re cards on your tax return.

This is very helpful information. I did not know this. Thanks.
--C.

When I put price paid into my spreadsheet I include the buyers premium, not shipping though

I consider both BP and shipping, esp. if the item is low cost and the shipping is considerable. Doesn't make sense to me to cost an item at $5 when shipping added $3 to it. To me that is a $8 item.

I include buyer's premium but not shipping when I record the card purchase in my excel spreadsheets.

Scott brings up an interesting point there...VCP includes the buyer's premium from auction houses, but eBay doesn't have BP and is included in VCP. Does that skew values at all (since a lot of eBay collectors don't use or, I'd bet, even know about a lot of these auction houses)?

The final cost to buyer (minus shipping obviously) is all that matters. How it's arrived at (ebay vs buyer's premium) is irrelevant.

From a seller's point of view, they need to take into account all premiums when deciding how to sell their cards... but that's another issue completely.

Copycat:rolleyes:

And yes, I do pay Federal & Virginia income taxes on my bb card profits (doesn't everyone?). For this reason, I much prefer to trade, rather than sell, cards that I acquired 10 - 20 years ago, so as to defer the income taxes.
Val