Tractors from Auctions, what do you check before buying.

[Reddogs]

Try defining "true value" These days that's not all that easy either.

It's very subjective from person to person what would be a good deal. I don't think you will find good reliable equipment for 40-50% of actual value. You will probably be able to find very questionable equipment for 40-50% of good equipment actual value. Then you have to decide if the risk is worth it to you.

Here is my subjective view. It will take research knowing what will be at the auction, researching actual moving prices for as similar of equipment that you can find in as close of shape as you can. If you would otherwise buy that piece of equipment for a similar price then it would be worth keeping an eye on the auction and trying to save 10-20%. Don't forget buyer's premium and freight and pick up time. A lot of auctions around here there is only a 3 hour or so window to pick up everything you won. I've been to a lot of auctions, some of them everything goes for a song and some everything goes for new prices or higher. There is no way to tell until you are there. Most auction companies are pretty honest with what information they have. Usually if they know something has problems, they will disclose that information. They rely on word of mouth and repeat business. That would not happen if they are known to mislead people. But, they don't know everything and don't typically do any homework past what is told to them. You own the problems you buy.

True value is the average price that it is selling for, take for example a John Deere 3035 with a FEL with no leaks or issues, it would go for around $22,000 for a used with less than 100 hrs, and around $27,000 for a new. So if at auction if you can get it for $10,000- 11,000 for a used or $15,000 to 16,000 for a rental machine with less than 50 hrs, you are doing well. If you get it for less than that $8,000- 9,000 for a used or $13,000 to 14,000 for a rental machine with less than 50 hrs, you are taking someone to the cleaners, and if you walk away OTO for less than $6,000- 7,000 for a used or $11,000 to 12,000 for a rental or basically new, you are definitely 'stealing' it....

 

[Reddogs]

I research the model online to find known issues, what to look for and if it is something I would want to fix if it has the issue or if I’m willing to accept the issues in the future and price accordingly. If it is not a consignment then I compare all the equipment to judge how well everything is maintained.

I have purchased couple tractors at auctions with good results. The best one was a JD 4430. Went couple weeks before auction test drove and checked it out. Clutch, shifting and driving went good. Hyd test was good. 3pt didn’t work right, dumping hyd. Oil in several locations leaking antifreeze Onto the ground. Went home researched and set my price. Bought it for $9000 and drove it 8 hours home. Nothing was fixed before auction so all tractors were there running and dumping fluids on the ground. It was a sight. The initial fix for issues was $1000.

To compare, I bought my JD 790 about 20 years ago, with a FEL and Backhoe, with about 200 hrs (Boss says 205), and with delivery of over 100 miles paid $12,500 with not a penny off. (I was young...) I think we had a headlight that was out and needed to be cleaned and that was it. I think I did ok, as the price from dealer for a new one was around $14,900 around that time plus FEL which I think was around $4000 around then, and the Backhoe which maybe was $5000. (Feel free to correct me on those, as my memory is not what it used to be)

 

[LittleBittyBigJohn]

So what would it take to be a 'bargain'...?

True value is the average price that it is selli...

Sorry, I thought you were asking a question about valuing a tractor at an auction. I was just sharing my experience to try to help you. Maybe someone else will gain some insight from my comment.

 

[Reddogs]

I would check coolant level, color, smell and if any signs of leaks or drips.

Pretty much the same for the engine oil, any hydraulic fluid or axle oil. Is it somewhat clean and the correct color and smell. If it looked like it was brand new, just replaced I might be leery of an issue possibly being covered up.

Some have been painted completely, and pretty good as I had to look hard to see any original paint, but some spots you can't reach.

 

[jjeff]

Some have been painted completely, and pretty good as I had to look hard to see any original paint, but some spots you can't reach.

personally imho I'd never buy a used piece of equipment that was re painted reminds me of when I was a kid my grandfather said he would never buy a used pickup truck that didn't have scratches or a few little dents on it.

 

[JasperFrank]

As LHF2019 said.. "research the model on line for known issues...." This would include a look up on parts availability. There is always a reason the machine is being Auctioned Off. Estate Auctions, have worked out the best for me. Attended many large commission based equipment auctions, which after a few years of always being out bid beyond my set limit, started to feel like a waste of time. Began to notice that the bidders, at these large auctions all seemed to be the same group of persons that all knew each other.

 

[jjeff]

As LHF2019 said.. "research the model on line for known issues...." This would include a look up on parts availability. There is always a reason the machine is being Auctioned Off. Estate Auctions, have worked out the best for me. Attended many large commission based equipment auctions, which after a few years of always being out bid beyond my set limit, started to feel like a waste of time. Began to notice that the bidders, at these large auctions all seemed to be the same group of persons that all knew each other.

Lol I feel the same way. Almost like I'm being played as the new guy on the block with limited financial resources. The big players seem to let the junk go pretty easy. Imo.

 

[Lineman North Florida]

Ok, well I know the Kubota and John Deere line the best, and most of their known issues and the cost of repair, so ok with that. So what would it take to be a 'bargain', 40-50% of the true value? As I just checked this Kubota skid steer and wondering what would be worthwhile to bid as it looked good and had all the things are working as they should and no leaks or issues...

That skid steer probably won't go for less than 50k, I went to a big auction in Georgia last week and one just like it but with about 1000 less hours went for 49.5k, but it hadn't been taken care of. I went with my mindset that I wouldn't spend anymore than 50k but after looking over all the skid steers and scrolling thru the stored engine codes I passed on everything, stopped at a small Kubota dealer on the way home and for less than 15k more than my budget was able to buy a brand new SVL-75 which to me made the best sense for me. The big thing about most of the larger auctions today is used equipment dealers onsite driving up the prices.

 

[PuffyC]

True value is the average price that it is selling for, take for example a John Deere 3035 with a FEL with no leaks or issues, it would go for around $22,000 for a used with less than 100 hrs, and around $27,000 for a new. So if at auction if you can get it for $10,000- 11,000 for a used or $15,000 to 16,000 for a rental machine with less than 50 hrs, you are doing well. If you get it for less than that $8,000- 9,000 for a used or $13,000 to 14,000 for a rental machine with less than 50 hrs, you are taking someone to the cleaners, and if you walk away OTO for less than $6,000- 7,000 for a used or $11,000 to 12,000 for a rental or basically new, you are definitely 'stealing' it....

I'll just start by saying that if a tractor is worth $22k on the used market you're not getting it for $11k. Or if you are it's only because you're the biggest sucker, you just haven't figured out exactly why yet. But you will. That's assuming you're planning on using it versus a dealer who only needs to find an even bigger sucker, of which there seems to be an endless supply.

If it's a regular consignment auction the big thing to check is who's bidding on what and how many times that same machine has been at the same auction. That takes months of watching but you'll see it if you pay attention. There's a lot of shady stuff going on at these auctions that's not really illegal but you're up against a bunch of people who literally do it for a living and they know how to work the system to their advantage. Read into that what you will. These auction houses know what they're doing too, and will often make deals for the good equipment behind the scenes so they can sell it on their used lot (or their buddy's lot) which may operate under a different name at a different location. All that is not to say there aren't good machines or good deals to be had, just that you get what you pay for like pretty much everything in life.

 

[LittleBittyBigJohn]

These auction houses know what they're doing too, and will often make deals for the good equipment behind the scenes so they can sell it on their used lot (or their buddy's lot) which may operate under a different name at a different location.

I've been to a few auctions where the auction house openly bid on the items. Funny how they were able to drive up the price and stop bidding just in time to not win the bid....