08/07/2012 11:01 am ET Updated Oct 07, 2012

Buying and Selling on Craigslist Like a Pro


I'm a sucker when it comes to new technology geared towards helping consumers save money (especially free ones). When we're browsing around the web for tips to save money, you'll frequently come across personal finance bloggers telling you to look at Craigslist.

I've been using Craigslist since 2007 ever since eBay and PayPal decided to rip off their users by increasing their seller's fee. From iPhones to even selling my car, Craigslist is my go to website for selling and buying everything.

One of the biggest problems I faced with Craigslist was trying to figure out what my asking price should be. Should I ask for a higher price first since most people will lowball me or should I price the item lower to get more interest? I recently came across this site called Priceonomics which actually takes the guesswork out of the process.

If you're ever looking to sell or buy anything on Craigslist, here are five tips I've learned from reading their blog and from my own personal experiences.

  1. Whenever I go to a retail store to buy electronics, I always ask the representative to see if they have an open box item. For the obvious reason, this is because used items are heavily discounted. If you're buying a new TV, an iPhone, or computer, always sell your old item if you're buying something new. Don't let items sit around at home; they tend to lose value over time. If you're looking to buy a new iPhone 4, you can sell your old iPhone3 for200.
  2. A few years ago when I was buying a car, a good friend advised me to buy a Honda Accord or a Toyota Camry. He said that these cars hold their values the best, so when it comes time to sell, I'll have more money in my pocket. Going back to the iPhone example, iPhones retains 63% of its value after one year while Android phones hold only 42%, and Blackberry phones hold 41% of their values. So if you're ever debating on what type of phone to get, always look at the phone with the higher resell value.
  3. Patience is a virtue. One of the great things about buying used items is that you'll eventually come across a hidden gem. Did you know that there are people who make their entire living off Craigslist? They'll buy low and sell high.
  4. Knowledge is power. Do your homework before you even begin to start your shopping. Look at completed listings on eBay, Priceonomics, or Pricegrabber (for new items). The more information you have, the more arsenals you have at your disposable. I've found that most sellers on Craigslist tend to come up with an arbitrary number on what they "think" they should sell it for. If you find that their asking price is too high, you can simply email them with your findings and negotiate a lower payment.
  5. Last but not least, use escalation of commitment to your advantage. Trust me, this works. Why? Because it happened to me. When I sold my car, I was missing a hubcap for one of my tires, and the seller decided to low-ball me a hundred bucks. At this point, I already met the seller and he had the money waiting for me. I didn't want to spend the time to look for a new buyer after all the hassles. So when it's time to meet the seller, look for wear and tear that allows you to ask for a 10-15% discount.
  6. Craigslist can be a great source to find awesome deals. With a little bit of patience and research, you can find great deals at a fraction of the price. As an avid user of Craigslist, one of the main lessons I've learned is to always be aware of the fair market value of a used item.