In tough times, car buyers can find jewels among junk at used car auctions
Used car auctions can be great places to find cheap used cars. They can also be places to find expensive lemons, so buyer beware.
As the economy struggles to leave the recession behind, some New Yorkers are still looking for ways to stretch or save a few dollars. The used car market is one place to search for deals.
And, if you’re really hard-pressed – or willing to take risks – there are car auctions.
Not even the suffocating humidity of a summer morning could discourage dozens of New Yorkers from checking out an auto auction at Ken Ben Industries, a Williamsburg, Brooklyn, tow yard. The weekly event features cars with more than $350 worth of outstanding parking tickets that had been towed by New York City Marshals.
Robert Stanton, a 42-year-old postal worker from Williamsburg, hoped his first visit to an auto auction would end up with him behind the wheel of a safe, spacious car for $1,500 or less.
“We’re looking for a second car that would become the family car,” said Stanton, who owns a 2007 Nissan Murano.
“If we can find something good and affordable, I will buy it,” said Stanton, who bought the Murano from a dealership.
Stanton was hardly alone in seeking a bargain. “Right now, in the used car market, there is high demand and low supply,” said Karl Bauer, a senior analyst at car-buying resource Edmunds.com. “Most people can’t afford a brand new car and those that own cars are holding on to them longer,” he said.
That means buying a car, even at auction, can be pricier these days. However, “If you’re prudent enough about your research, a used car [bought through an auction] can be very useful” – and a bargain, Bauer said.
But finding a worthy car in a tow yard may be a challenge for inexperienced buyers. Only 30 minutes is set aside for inspecting the vehicles before the auction begins, and you aren’t allowed to drive the car or even open the doors. It helps to be a savvy mechanic or someone with a keen eye for spotting a jewel amid the clunkers.
“If you wanted a car for your family, you can find it here if you know what you’re doing,” said New York City Marshal Frank Siracusa.
Even frequent auction-goers like Ali Amin Zila, a 21-year-old waiter from Astoria, Queens, can make rookie mistakes. At an auction in the Bronx over the summer, he paid $1,400 for a Toyota. Only later did he discover that it didn’t have an engine.
At a more recent auction, Zila enlisted an uncle who offered to help him inspect prospective vehicles. Zila was looking to buy a van for his business selling sundries.
Despite a sudden downpour the day of the auction that lasted for more than an hour and quickly turned the dirt-and-gravel tow yard into a mud pen, the crowd swelled to about 100 eager potential buyers.
The bidding for each of the 46 cars up for auction started at $100, regardless of the make, model or age. On average, cars went for around $700 to $900. But they often sell for not much more than the minimum bid.
The auction of 10,043 towed vehicles brought the city $1.5 million in the fiscal year that ended this summer, in addition to the amount of the tickets and after paying off fees like towing and storage, according to the Department of Finance.
If the money raised exceeds the fines and expenses, the vehicle’s owner receives a check for whatever is left, Siracusa said.
“But if the money doesn’t cover the fines, then the car owner gets another ticket,” he added.
While some people come to the auctions hoping to get a reliable car for personal use, others have turned buying, fixing and selling cars into a business.
Kelvin Ford, 35, of Valley Stream, Long Island, attends car auctions all over the city most days. The marshals typically run seven to eight auctions a week, depending on the inventory of available cars. Notices of the auctions are published as legal notices in newspapers. Information can also be found by calling 311 or checking nyc.gov.
Ford said he buys about 40 cars a month, makes repairs or improvements and resells them for at least $1,000 each.
“These auctions have made me a millionaire,” claimed Ford, who arrived at the auction in a Bentley, one of three he said he owned. The aptly named Ford has been in the auto sales business since he was 19, when he was living in South Jamaica, Queens.
Experts cautioned that few people can boast of auction success like Ford.
“I always advise people: ‘When you’re looking for a used car or buying it at auction, you need to have a mechanic with you,’ ” said Jeff Ostroff, a consumer advocate and auto-buying expert for CarBuyingTips.com. “The odds are stacked against you.”
Another tip: Bring along a smart phone to quickly run a report from Carfax, which sells vehicle histories and delivers them online.
Even with careful due diligence, buying a car at auction remains risky, Ostroff said.
“There are way too many unknowns,” he said. “It’s almost like buying a car without being there.”
If you don’t have the skills of a mechanic, car auctions can seem a bit like the Wild West. Once you get passed the sheriffs and auto-wranglers, however, even these dog-and-pony shows have rules.
Here are 15 tricks of the trade to keep in mind when bidding on a used car at auction: