Hammer price

The hammer price is the last amount announced by the auctioneer before the hammer falls. It forms the contract of sale between the seller and the last bidder, provided any reserve price has been reached.

It is a basis for calculation more than a price paid:

• The buyer pays the hammer price plus the buyer's premium and taxes, commonly 27 to 33% more, and more again with import VAT for a purchase from outside the European Union.
• The seller receives the hammer price minus their commission and any ancillary costs set out in the consignment agreement.

Between what the buyer pays and what the seller receives, the gap can therefore exceed 40% of the hammer.

Why it matters for valuation: houses mostly publish results including the premium. Comparing that figure with a dealer listing or with a model's market value means comparing two prices of a different nature. Before drawing a conclusion, bring the result back to the hammer, then to the seller's net.

Example: a watch reported as "sold for CHF 25,400" at Phillips in Geneva was hammered at CHF 20,000 (27% buyer's premium). If the seller negotiated a 10% commission, they received about CHF 18,000, before their own costs.

Our article reading an auction catalogue explains this conversion for valuing your own watch.