Comments on: Auction Approaching

By: stubbornmule

stubbornmule — Tue, 24 Feb 2009 09:56:10 +0000

In the end we changed our reserve during the auction. While this is probably not the most effective strategy, we’d originally set the reserve a little higher than the lowest we would accept. When the bidding came to a halt below the reserve, we agreed to lower the reserve to our minimum. The agent was hoping that putting the property on the market would prod a third bidder into play. This didn’t happen and the house sold at that the new reserve. So I’m glad that we didn’t set the reserve below our minimum just to try to put some life into the bidding! So overall, an acceptable, but not fantastic result. The property settled yesterday and I’m very glad it’s all behind us.

By: Sue

Sue — Sat, 21 Feb 2009 21:30:54 +0000

But you never told us how you set your reserve! Obviously if you sold the house it worked to a certain extent, but did you feel that you made the right decision about what the reserve should be?

By: dan

dan — Thu, 18 Dec 2008 12:13:52 +0000

mazel tov. see you tomoro

By: stubbornmule

stubbornmule — Thu, 18 Dec 2008 06:20:51 +0000

@Marc: the price was at the lower end of our expectations, but it was a price we had agreed beforehand we’d be happy to take. More than anything I’m glad it’s all over!

By: Marc Lehmann

Marc Lehmann — Thu, 18 Dec 2008 06:12:01 +0000

I saw it on twitter and read it as mixed emotions and relief so I didn’t want to throw in an inauthentic congratulations. So if you are happy Congrats! :) My condolences otherwise ;)

By: stubbornmule

stubbornmule — Thu, 18 Dec 2008 05:59:31 +0000

I should also add that last night we sold our house, so I can stop obsessing about auctions now!

By: stubbornmule

stubbornmule — Thu, 18 Dec 2008 05:58:37 +0000

@Marc: You make a good point, vindicating GPat!

By: Marc Lehmann

Marc Lehmann — Thu, 18 Dec 2008 05:48:47 +0000

Actually eBay is a hybrid of English Auction and Sealed First-Price Tender. The time line approaching zero being the end of the auction forcing bidders to make one final bid which becomes very tender like and sealed by the nature of the eBay application not giving bidders time to see the latest highest bid in the final seconds. The request of their servers isn’t returned to the bidders browser quickly enough that they can read and submit a new bid before the auction closes. So the participants don’t really know what the final bids are that are made in the final few seconds. In this environment your ISP connection speed, keyboard skills and timing become important factors. The sum effect of which is undisclosed pricing like a Sealed First-Price Tender.

By: stubbornmule

stubbornmule — Thu, 18 Dec 2008 05:37:38 +0000

@GPat: eBay options are essentially English auctions: the bids are public and the price keeps rising until the bidding stops. The twist on eBay is that you can enter a single limit and have your bids placed automatically with the smallest possible increment. Nevertheless, there is still a bidding process, even if much of it is automated. The differences between this sort of auction and a Vickrey auction are that the Vickrey auction bid is not public (you get no information when placing your bid as to where other bidders are) and you are only allowed a single bid. In an English bid, you start bidding low whereas, in theory, with a Vickrey auction you will put one bid at the maximum price you are prepared to pay.

By: GPat

GPat — Thu, 18 Dec 2008 04:42:47 +0000

Sean – isn’t an eBay purchase basically a Vickrey auction?? – qt least a variant when you bid your highest price but pay only a bid increment above the second highest price? I’m not sure i trust eBay to manage this process “properly”