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Going once . . . going twice . . . Sold! ... to the man with the high- speed modem

Americans have always loved a garage sale.

So it's no wonder that they flock to flea markets where they can wear their bathrobes and sit in their own living rooms.

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Online auctions have grown from tiny markets a year ago to giant communities of like-minded traders -complete with regional picnics - with millions of members today.

Just last week, Web giant Lycos, which provides an entry point to millions of surfers, launched its own auction site that promises to be one of the largest on the Internet.

But like garage sales, online auctions offer both gems and junk. And sifting out which is which requires some new techniques.

Online auctions divide roughly into two categories:

*Merchant auctions, where stores sell surplus goods to the highest bidder. Many of these sites specialize in particular types of goods.

*And person-to-person auctions, where individuals list goods to sell as they would at a "real time" flea market -you never know what you'll find.

A few "auction" sites aren't traditional sales outlets at all. and, for instance, auction lots of electronic goods, sporting goods, appliances, and more. The goods start at a fixed price, which drops as more buyers take the deal.

About these ads lets you name your price for travel or cars, and merchants accept or reject your offer.

The watch-and-learn approach

Some sites offer options. And a few others don't run auctions at all, but monitor trading at several several sites that that do.

These sites, iTrack, Bidder's Edge, and BidStream, can be a good place to get a feel for pricing before plunging in.

"Go to be a viewer, to get familiar with the format, before you spend money," says Cleo Manuel of the National Consumers League (NCL) in Washington.

That's essential if you want to avoid paying too much, says Jeff Zygmont, a Salem, N.H., resident who has bid on items several times only to see prices soar beyond retail. "A lot of things were going at pretty high prices," he says.

Finally, he bought a 1950s hand-crank ice crusher on eBay. "I just wanted to see if anything would catch my fancy," says Mr. Zygmont, who owns a small collection of antique kitchen appliances.

To Zygmont and other buyers, the big advantage of online auctions is the variety of goods available in one place. "Who knows if I ever would have stumbled across [this] at a flea market," he says.

Most auction sites list the current bid on an item or service, the minimum you can add (anywhere from 50 cents to $5), number of bids made, and a seller-set closing date on the auction.

You can enter the maximum you're willing to pay, and the site will automatically increase your bid up to that limit. Or you can ask the site to send you e-mail whenever another user tops your latest bid.

Another strategy: logging on at the last minute to outbid everyone else. "It becomes a race to see who has the fastest connection," says Ms. Manuel.

The danger of auctions is that you can't inspect items before you buy them and the sellers are relatively anonymous, says Lisa Hone, who monitors auctions for the Federal Trade Commission.

Complaints to the NCL shot up 600 percent between 1997 and 1998 -and 68 percent of those came from online auctions, says Manuel. Out of more than 1 million sales a day, that's still not many bad sales.

The biggest problem with online auctions is their anonymity, says Manuel. To combat that, sites work to build a sense of community among traders, making poor citizens accountable for their actions. Virtually all the sites require users to register before listing something for sale or bidding. Most require a credit card for identification to register. Users leave comments and ratings, good and bad, about each other in the community.

But pay attention to who leaves positive comments, Ms. Hone says. Some sites allow anyone to comment. Others allow only members who have bought or sold to speak.

The distinction is important, because if anyone can leave comments, sellers or their friends may leave positive comments to create a good impression.

Some auction sites such as Auctions also offer their own guarantees. If you buy something for less than $250 on its site, Amazon will refund your money if the seller reneges, says auction manager Joel Spiegel.

Several sites such as TradeSafe, and iEscrow also offer insurance for online trades. Called escrow services, they charge a small fee (from zero to 5 percent of the transaction price) to hold your money while the seller sends you the product. Then you approve before the seller gets paid.

Some sites are beginning to offer credit-card services to individual sellers. And eBay recently bought Billpoint, a service that may soon allow individual sellers to accept credit cards - for a fee.

Ensuring a secure site

Before typing your credit-card number online, make sure the site provides secure transactions using encryption, says Manuel. You should see a message on your computer saying you're entering a "secure site" before sending credit-card information.

Credit cards limit your liability usually to $50 or nothing for defective goods or those you don't receive. If you don't use a credit card or escrow service, send a check through certified mail and request a return receipt.

Always use the US Postal Service to send checks; private carriers aren't backed by mail-fraud laws. "The best defense is to be a smart consumer, just like anywhere else," says Amazon's Mr. Spiegel.

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(c) Copyright 1999. The Christian Science Publishing Society

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