Precious metals investing picked up significant steam after the pandemic broke out. Fortunately for excited investors, there are plenty of places to buy bullion. Of course, they’re not all created equally. This has left many people asking whether they can save money buying gold on eBay.
People have long looked toward eBay as a source for major discounts. Toss in the fact that you can find just about anything on the platform, and the e-commerce site is certainly an amazing marketplace. Unfortunately, this might not be the case when purchasing bullion.
When considering buying gold on eBay, there are some important things to know. While the website may seem like a chance to get bullion at low prices, the reality is more complicated than that. If you’re not careful about buying precious metals on the platform, you could lose money.
The Myth of Saving Money via Buying Gold on eBay
Of all the online marketplaces available to consumers, few can tout the consistent savings offered by eBay. One of the few studies that looked into real cost analyses found that Americans save an inflation-adjusted amount of more than $10 billion every year on the site.
While Amazon may currently have more users, people simply cannot pull themselves away from the auction-style platform. When you’re buying gold on eBay, you will encounter both auctions and “Buy It Now” listings. Both may seem like cost-saving options, but the data shows otherwise.
The most important thing you can do before purchasing bullion is to check the gold spot price. When you look on dealer websites, you’ll often find higher prices than spot. This is what drives many people to eBay, but these premiums actually cover important costs, such as:
- Exploration
- Mining
- Refining
- Transportation
- Minting
- Insurance
- Retail costs
Many people believe buying gold on eBay will help them avoid these costs. Unfortunately, that’s simply not the case. Any private seller offering bullion on the site had to pay a premium on their purchase. You can fully expect the seller to pass this premium on to you.
Of course, you can always shop around on the platform. There’s bound to be someone selling gold at spot price, right? Unfortunately, that’s simply not the case. The demand for gold is so high that the U.S. Mint recently had trouble keeping up with it. Sellers on eBay are no different.
You’re not the only person to think you could save money buying gold on eBay. Even back in 2015 — long before demand jumped during the pandemic — the platform saw massive spikes in bullion sales. With demand as high as it is, even eBay can’t offer significant savings on gold.
The Dangers of Buying Gold on eBay
There are some very obvious issues that come with purchasing bullion on eBay. The most surprising issue is that you won’t save money. Between high demand, increasing premiums, and high seller fees, you may very well lose money buying gold on the e-commerce platform.
Unfortunately, this is far from the only danger inherent to buying gold on eBay. Even if you’re vigilant with your research and find a great price, you could still end up losing your entire investment. Here are just a few of the issues unlucky eBayers sometimes encounter:
- Fake gold: The popularity of everything from American Gold Eagles to 10-ounce bullion bars has always caught the attention of forgers. This has created an influx of fake gold on the market, and your seller may have acquired imitation bullion without realizing it.
- Counterfeit hallmarks: It’s possible to buy counterfeit gold while still acquiring real bullion. Criminals often stamp illegally-mined gold with counterfeit refinery hallmarks. You could end up buying an illegal item that funded criminal or terrorist organizations.
- Fake sellers: Trying to buy gold on eBay could end with you receiving a fake coin or bullion bar in the mail. Of course, it could also result in you receiving absolutely nothing at all. Criminals frequently create fake eBay accounts in order to sell items they don’t have.
- Pumping up bids: Some sellers create alternate accounts to artificially inflate their bids. If you bid on a Chinese Gold Panda and the seller wants a higher price, they can use an alternate account to bid on the item and increase the price the winner eventually pays.
When buying gold on eBay, you might not encounter any of these issues. Some people have purchased bullion on the site for years without running into problems. Considering the high value of gold, however, it only takes one negative experience to erase all your profits.
Of course, many of these issues arise among folks who buy from private sellers. Even if these sellers have high feedback scores, they’re typically not experienced dealers. Wouldn’t you be safe by just buying from major brands that sell on the platform?
While this is the safest way to buy gold on eBay, it’s not as beneficial as you might think.
What About Buying Gold on eBay from Major Dealers?
There are several major gold dealers who sell bullion on eBay. This offers companies an additional revenue stream that can be very profitable. When you purchase precious metals directly from these dealers on the e-commerce platform, you can trust you’ll receive real gold.
Unfortunately, this strategy can also be very costly. When a reputable dealer sells gold on their website, they have to include a premium to cover related costs. Unfortunately, these costs go even higher when they’re selling on eBay.
That’s because the online marketplace charges fees for sellers who use the platform. Sellers will pay over 12% of an item’s selling price directly to eBay. This means reputable dealers have to sell at a higher premium in order to cover added costs of using the e-commerce site.
How to Safely Buy Gold Online — Including eBay
Many people buy gold on eBay to avoid the costs of purchasing locally. Small dealers often have to sell at inflated prices due to higher overhead expenses. They simply lack the resources of larger companies, but eBay offers the chance to buy from regular people who don’t have those costs.
Fortunately, most of the benefits people expect from eBay are related to buying gold online rather than on the e-commerce site. Of course, you can run into issues when making a purchase on any online platform. That’s why you should abide by a few simple rules when buying bullion online.
- Always check reviews: On or off eBay, you should always check seller reviews. This offers an idea of what other consumers think of their experience with a seller. These ratings are available on eBay seller pages, but you’ll need to check online review sites when buying off the platform.
- Buy from reputable sources: eBay may seem like a great place to buy bullion, but you might risk your investment by doing so. It’s best to opt for reputable sellers and buy directly from their websites. This helps you avoid the disadvantages of buying gold on eBay and get a better price.
- Know what you’re buying: Whenever you’re purchasing gold online, you need to know the spot price and how much gold you’re getting. Dealers like Silver Gold Bull show the spot price on every page on their site, and you can even sort purchasing options based on their prices per ounce.
- Use dealers with storage options: When you own significant amounts of gold, storage can become an issue. Work with a dealer like Silver Gold Bull that offers free shipping to their allocated storage facilities for their buyers. This will save you money.
By keeping these safety measures in mind, you can protect your investment. Whether you’re buying gold on eBay or from an international dealer, remaining vigilant about your purchase is imperative. Even if you buy small amounts, gold isn’t a negligible investment.
A single oversight is enough to wipe out years of steady profit. Of all these safety strategies, though, the most important is to purchase from a trusted source. Whether you do this when buying gold on eBay or save a few dollars by purchasing direct, you’ll at least know your gold is authentic.
Buy Gold from a Reputable Dealer Today
Technology has made purchasing bullion easier than ever. With only an internet connection and bank card, investors can buy precious metals from every corner of the world. They can even have it shipped directly to their home or stored in secure bullion facilities.
Unfortunately, the ease of this process is deceptive in some ways. While buying gold on eBay may seem like a profitable endeavor, there are many unexpected hurdles in the way of profit. If you use the e-commerce site with the intention of saving money on bullion, you’re likely to be disappointed.
At Silver Gold Bull, we understand the desire to get a great deal on bullion. That’s why we offer bulk discounts starting at quantities of two for certain items. And with our Best Price Guarantee, you’ll always get a great value. Visit our Gold Bullion page today to find the investment that’s right for you.
