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Is there any money left in going to dealer auctions and flipping cars?
Ok guys so I need advice...bad. I am a 23 year old from SoCal. I have 17k saved up and want to invest it. I know that is not much money and the general census will tell me "keep saving". However, I have a friend who is basically jumping up and down on putting that money into an auction. We have a friend who has a dealers license and can get into any dealer exclusive auction in Cali.
The only thing I am weary of is, I read online of someone who owns a dealership and posted this article how "people assume that cars in dealer auctions go for at least 20-30% below market value, and it does not work that way anymore". He basically said that too many people now have dealers licenses and go to these things, and over flooded them and make the car prices go too high. He pretty much said that you will be lucky to make $500 profit per car, even if you do know a lot about cars and have much experience. However that post was posted 4 years ago out of Florida.
Can anyone tell me if there is money left to be made at these dealer auctions? And yes my friend knows cars extremely well. He works on cars on the side and is a sales rep at a dealership.
The only thing I am weary of is, I read online of someone who owns a dealership and posted this article how "people assume that cars in dealer auctions go for at least 20-30% below market value, and it does not work that way anymore". He basically said that too many people now have dealers licenses and go to these things, and over flooded them and make the car prices go too high. He pretty much said that you will be lucky to make $500 profit per car, even if you do know a lot about cars and have much experience. However that post was posted 4 years ago out of Florida.
Can anyone tell me if there is money left to be made at these dealer auctions? And yes my friend knows cars extremely well. He works on cars on the side and is a sales rep at a dealership.
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Or buying cars at auction, and then selling them to the public?
If it's the first example, wouldn't your friend with the dealer's license already be doing that, if possible? What would he need you for? On the second example, that's illegal, unless you own a car lot. I don't think you can start a car lot for $17K.
Do dealers occasionally get a car at auction that slides by for $1000 less than they think it's worth? Sure.. Do they sometimes make money by just running it back through the next week, without ever picking it up? Sure.. Does it happen often, with 50-100 other dealers at the auction bidding on cars? Doubtful.
On a related note.. who is doing all the work? You can't use your friend's license to go to the auction yourself.
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