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re: Is shill bidding illegal in Louisiana?
Posted on 7/16/16 at 11:02 pm to stout
Posted on 7/16/16 at 11:02 pm to stout
quote:
It's more than that. They have preview days so I go through what I plan on bidding on and rank them. I'll pass on say my 3rd option if my number one option is in line after it only to have the seller bid against me. Reserves would prevent this and make me planning my "strategy" easier. It's a waste of time as it stands.
No matter what, you still have to factor in the fact that there might be something there willing to pay more than you. What else can you really do besides look through the items and set the price you are willing to pay for it? How does it differ if the owner or someone else is willing to pay a certain price to get the item?
1
Posted on 7/16/16 at 11:09 pm to OweO
quote:
you still have to factor in the fact that there might be something there willing to pay more than you.
No shite but they are also looking for a deal and don't have a vested interest to drive the price up unlike the owner. Bidding against another legit bidder is a whole different scenario than bidding against the owner in my experience.
Posted on 7/17/16 at 3:06 am to OweO
quote:
That's what I am thinking. They own the item, I assume they pay a cost to list it. Lets say they expect to get 2000+ for it but the highest bid is $1650, they bid that up to $1700. They go to the next auction and in order to come out ahead from paying for it in the last auction they need someone to bid $1701 plus the cost of listing it in two auctions. If at the next auction, the highest bid is similar to the highest bid from the last auction, they can't buy it back again expecting to make a profit. It seems like a risky move.
So wrong
Posted on 7/17/16 at 4:29 am to OweO
quote:
That's what I am thinking. They own the item, I assume they pay a cost to list it. Lets say they expect to get 2000+ for it but the highest bid is $1650, they bid that up to $1700. They go to the next auction and in order to come out ahead from paying for it in the last auction they need someone to bid $1701 plus the cost of listing it in two auctions. If at the next auction, the highest bid is similar to the highest bid from the last auction, they can't buy it back again expecting to make a profit. It seems like a risky move.
That's not how it works. They are only out the listing fee.
This post was edited on 7/17/16 at 4:35 am
Posted on 7/17/16 at 7:14 am to stout
The auction house gets a cut, let say 10%. Therefore, if the original owner buys his stuff back, he loses 10%. It's not like he gets it back free and clear.
Posted on 7/17/16 at 7:41 am to stout
quote:
Seems like a good way to open up to a class action allowing this to happen if it is illegal.
Seems like a good way to make $1.28.
Posted on 7/17/16 at 7:41 am to crazycubes
The vast majority of estate sales and even some storage auctions I frequent charge a 10% buyers premium. But these are generally for lower priced items. I would imagine for expensive heavy equipment the premium is capped at a certain level.
I don't see how this could be profitable in the long term. The seller likely is already paying a listing fee (maybe even as a percentage of final sale price, say 5%), then paying a buyers premium + tax in most states if he buys his item back. So let's say he buys his own item back for $1000: that's $50 (sellers premium) + ($100 buyers premium) + ($60 sales tax). That's $210 on top of the final bid price. Sure he will get his $1000 back as payout but it would only be $790 after all that.
Auction house almost certainly has to be in on the shill bidding for this to make sense. I would report them. In my state I know of 2 auctioneers that are under criminal investigation because they were taking estate sale items from elderly folks and keeping some of the items for their own personal sale. They also are in trouble with the ATF due to some shady gun sales at auction.
I don't see how this could be profitable in the long term. The seller likely is already paying a listing fee (maybe even as a percentage of final sale price, say 5%), then paying a buyers premium + tax in most states if he buys his item back. So let's say he buys his own item back for $1000: that's $50 (sellers premium) + ($100 buyers premium) + ($60 sales tax). That's $210 on top of the final bid price. Sure he will get his $1000 back as payout but it would only be $790 after all that.
Auction house almost certainly has to be in on the shill bidding for this to make sense. I would report them. In my state I know of 2 auctioneers that are under criminal investigation because they were taking estate sale items from elderly folks and keeping some of the items for their own personal sale. They also are in trouble with the ATF due to some shady gun sales at auction.
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