Reverse Auctions

Reporter: Gavin Alder

There are now many creative ways to get finance for a home, as more and more groups compete for your mortgage dollar.All of them involve years of re-payments, and big sums of money. Now there's another way.

It's called a reverse auction and unlike conventional auctions this sale will be won by the person with the lowest unique bid. The absolute maximum you can pay is $17 000.

"This is where you enter your amount between 1c and $17 000 ..in this box here... Lets say for eg; I want to bid $10.62, you simply put in here $10.62 submit your bid straight away it will come up and tell you its not a unique bid it is lower. But the odds are pretty high, there are 1.7 million bids between 1c and $17 000" explains Phyllis Dunn.

"Well the difference [from a traditional auction] is that people actually decide, I mean you are in control cause you go online and place a bid, you think about it, where is with a raffle you buy a ticket and off you go... so you do have some control over it."

Christopher Zinn Australian Consumers Association says "Its certainly not gambling cause a company would not be able to run this if that was the case." Phyllis Dunn from Unique Bid Homes which is running the reverse auction says the company has put in place responsible guidelines.

With millions being gambled and lost on just one horse race today, bidding for the unit is a gamble with limitations. Each bid costs $5 but no one can make any more than 20 bids per week. So the most a person can spend trying to secure their little slice of the Gold Coast is $100 a week.

It's the first auction of its kind in Australia. The company makes its money with the expectation the number of bids will exceed the value of the unit.

The Unique Bid Reverse Auction closes on 3 rd December. More information can be found at www.uniquebidhomes.com.au