Originally Posted by
Darnash
I like it when people undercut me by a few silver or copper. Why? Because the item doesn't lose too much value. Regardless of how much the person undercuts me, I'm going to have to re-list my item and undercut them. Some people say I should wait until the other person's auction sells, because then mine will be next in line, or to simply buy their item if it's a significant undercut, but in actuality if I were to wait then more people would undercut the undercutter, and if I were to buy it would be counter-intuitive to my goal of exchanging my goods for gold. I'm not here to play the auction house, I'm here for a simple exchange of goods for currency.
I do not like it when people single-handedly kill a market. You may think, "It's only my goods, I just want to get rid of them quickly", but in doing so you are creating a new benchmark. Eventually, the market will stabilize itself (if the equilibrium price falls too much, less people will be willing to supply it and they will not be able to match demand, therefore the price will have to raise to compensate, economics 101), but for a few days or even a few weeks a single undercutter can significantly reduce the price of goods. If you undercut by only a few copper/silver, and the AH price is already at equilibrium between supply and demand, your item will still sell the fastest unless you see some vindictive person who doesn't buy (x-g, 99-s, 99c) for some illogical spite decides to buy the next item up. In this case, I find that it's actually best not to undercut the Buyout price AT ALL, and simply undercut the bid price. Most people search by lowest bid, and your item will, again, appear first and for the same price. It will still sell, and for more money than you would get for undercutting. And if someone else undercuts you, well, you're going to have to re-list your item again whether they undercut you by 99 silver or 99 gold.
The only advantage to large undercutting is that it sometimes attracts buyers who would not otherwise pay the current AH price. These hold-outs are pretty smart in their own regard, because they are able to turn a huge profit on others work. So yes, you may find that you will instantly find a buyer, and you may be happy with the price. But in the majority of cases, the AH equilibrium price is actually the fair one, and had you listed your item for a small undercut, it would still sell.