Ebay Reserve Price Auctions - Beware

I wasn't involved in this auction for a Pentax 50mm f/1.2 last night,(I already have two Tomioka f/1.2's) link but I just stumbled across it as it was ending. The price a couple of minutes before was less than the reserve at about £158.... It went for a strange figure £199.99 and I immediately thought what an idiot... he would lose out for a penny to someone bidding a more likely £200. I was curious to see if it was a snipe or not so I looked at the bid history. It wasn't a snipe and was placed 15 secs before the end, giving someone else time to outbid.

I then noticed that the same person was the 2nd highest bidder with a bid put on 7 mins. previous for £160, the actual 2nd highest bidder was for £151.67??

I then remembered something similar happening to me with a snipe where I paid way above the 2nd bid

I've just looked up ebays help pages and they state:
If your maximum bid is the first to meet or exceed the reserve price, the effective bid displayed will automatically be raised to the reserve price. link

The reserve in this instance must have been £199.99

This is totally unfair IMHO, they don't state the reserve and why should the seller have to pay way above what other people are willing to pay? You don't mind paying say £200 if others value the item at £195, but a reserve can be completely above valuation. What's to stop the seller using an unrealistic reserve. Valuations by other buyers become unimportant and are ignored by ebay. In fact if you are a seller that seems the way to go.

Surely the OFT should look into this? Ebay should at the very least ask you to confirm that you are happy to pay way above what the other bidders are willing to pay.

The buyer was lucky in this case, he still got the lens for a bargain price probably because the seller only had a feedback score of 7.

I think the only way a buyer can deal with this is to write to the seller and ask what the reserve is (OK by ebay rules) and if they supply it don't bid if it's higher than say 80% of what you think the items worth.

If it bothered me I would contact eBay and ask for clarification.

I think this means that the first person to pay the reserve price or more will get it at the reserve price. So if my bid is £210 then I'll pay the reserve price of £199.99, not £210.

Under certain circumstances, the bid will automatically be raised, not lowered.

Edit: This was in reply to John's post.

That's correct, but your no longer bidding against anybody
Twenty Five bidders stopped at £151.67 making the market value of the lens about £155 max.

In a proper auction the bidding would stop at around £155 and it would be referred back to the seller to see if he was willing to accept the £155 market value or not, even though the reserve hadn't been reached. They never ask the bidder if he wants to buy it at the reserve price without asking the seller first. Ebay just don't tell you what's going on?.... you think you are in an auction, but it's more of a BIN

In any auction you should only be bidding up to what you are prepared to pay and what you think the article is worth. It is irrelevant what others think it is worth. If you are still the highest bidder but below the reserve at the end of the auction then either the seller may relist with possibly a lower reserve or may send you a second chance offer.

That's not how auctions work, the price ping pongs round the room between bidders and stops at the highest bid.

I always understood that by putting on a maximum bid you were agreeing to pay above what the last bidder was willing to pay.... not suddenly jump up to an unknown reserve

Just for the record I never put on a maximum bid, I put on a snipe and only bid directly if I am the 1st bidder so that the seller at least knows he is getting someone bidding.

I'm a bit confused by the logic here. you bid £200 because presumably you are prepared to pay £200 for the item. in this case, if your bid was just £160 (because that is slightly more than the second highest bidder) you would still be under the reserve and you would not get the item. isn't it better to get the item for a price you are happy to pay than miss out because no-one else bids enough to get you over the reserve?

No it's better for the sale not to go through.

It happened to me recently, the seller had put on an unrealistic reserve I was the highest bidder and I sent the seller a message about 15 mins. before the end saying that I was already bidding more than the item was worth and I didn't think they would get any higher bids, they agreed and let the auction finish without a sale. They then put the item back with a high BIN or OFFER I made an offer at my previous bid price and got the item.

It all depends on your point of view, I'd rather have the item I wanted than mess about and maybe not get it. Life's too short to spend too much energy on an eBay auction. I try very hard to just put in what I want to pay and then walk away and forget it.

If I win, great, if I don't then I continue looking for the item.

I don't see what the fuss is, the listing will clearly say there is a reserve 7 that your bid has not reached the reserve. All you are doing when there are no other bidders is bidding against the reserve.

If you want to know the reserve, bid high which will reveal the price & then cancel the bid, that is in the rules also

Careful... although it's within the rules to retract a bid because it was 'the wrong amount', there are consequences...

I didn't think you could cancel a bid

Incidentally, I don't think it's that uncommon for the reserve price not to be known to the bidders.

Here's the Christie's FAQ, for instance.

I don't see what the issue is here. Ebay has always operated on a 'bid your maximum' basis. If you bid below the reserve, hard luck. If you bid above it, your bid goes in at the reserve, and then increases automatically up to your maximum, if other people then bid more than the current bid, but less than your maximum.

People operate differently from this, for sure, which is why you can sometimes get a bidding frenzy.

But there's nothing unfair about it.

Christies do state:
"The seller (consignor) and Christie's mutually agree on an appropriate reserve, which is confidential but may not exceed the low estimate."

So they don't allow HIGH Reserves which ebay DO

I didn't say that the eBay rules are the same as Christies.

The point is that however it's set, it's not unusual for the reserve to be unknown to the bidders.

Unlike Christies, there is no eBay process for deciding what the rough value of the item is. If a seller doesn't want to sell at all if the price doesn't reach what he wants for it, that's just tough on the buyers.

Don't bid on items with a reserve, if you don't like sellers expressing a view of what they want for it.