For example, I go and buy something for $100, and auction that something starting the bidding at $1, and then hope for the best. Almost sounds like a gamble. Which is why I am asking if auctions are permitted according to Islamic law?

1 Answer 1


While buying something for $100 and auctioning it at a starting bid of $1 is a highly questionable business practice (why not just start the bidding at $100?), there's no reason to believe it's forbidden Islamically. Even the prophet himself is reported to have auctioned off items.

Auctioning is merely a method of determining the final price for a sale; so long as this final price is decided fairly and agreed upon by both parties when the transaction itself takes place, it's just a sale like any other.

  • You say "agreed upon by both parties" however, unless otherwise stated, the convention for auctions is they will need to be honored at the price reached even if the seller doesn't necessarily agree to the price. Does that scenario change your answer?
    – banging
    Jun 7, 2013 at 19:15
  • @banging That doesn't even make sense; why is the seller even auctioning his items if he's not going to agree to sell it?
    – goldPseudo
    Jun 7, 2013 at 19:17
  • He agrees to sell it but he might have been hoping for a higher bid. If the bid he was hoping for wasn't reached, he is still obliged to honor the auction (even though he might not agree to the final bid). Does that make sense? Otherwise, please delete my comments! Peace.
    – banging
    Jun 7, 2013 at 19:19
  • @banging When he auctions, even if he is hoping for a higher price, he understands the risk that he might be the final bid. The action of auctioning in itself means that one agrees to a specific price and is willing to pay for it, ones intention is secondary.
    – user2350
    Jun 8, 2013 at 22:14

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