Usually, in any kind of somewhat civilized place, there is no such thing as “instantly”, and there are no (legally binding) equity sales without cadastral register and the like. So that simply won’t work (unless you are outright criminally fraudulent and sell something that you factually don’t own).
Nevertheless, I got my first apartment almost exactly that way, with a little twist, 25 years ago.
At that time, you would go to the district court, show them some cash which should be approximately 10% of what you might reasonably want to bid later, and then you’d go bidding. This no longer works nowadays, you must instead do a cable transfer 4 weeks earlier (and you can only use it for a single auction, not as a “in general” deposit, and getting your money transferred back takes 2 weeks, too), or bring a certified FSCB check no older than 3 days, or a confirmed unlimited bail on your bank account with sufficient money on it (ridiculous, isn’t it?).
After the hammer dropped, you leave the cash as a security deposit, and you owe the rest of the money to the court, which you can pay immediately, or at 4% interest rate can delay payment for up to 8 weeks. After said 8 weeks, there’s another day at court (don’t know the English word, German word is Verteilungstermin) at which it is finally decided who gets what. Usually, just the one person having done the highest bid gets the whole estate that was auctioned, and the first in line of creditors takes all the money, and the rest leaves with a frown because there is no money left after that. But your mileage may vary there.
What happens if you don’t pay? Well, court seizes everything you own, and if they aren’t happy with what they got, they re-auction the property…
On that second court day, 8 weeks later, you are technically the owner, but you still need to get your name written in the cadastral register in order to be the actual owner who can sell the property. Which, because it is very complicated task for a governmental official, takes around 2-4 weeks, too. Without your name in the register, you need not even ask a notary for an appointment, and sales without notary are null and void.
So, all in all, you need to bridge a gap of roughly 12 weeks for “instant resale”. That doesn’t work!
However, there is (or used to be, not sure if that’s still the case) a shortcut out. This is how I got my apartment back then. There was a guy who tried to pull off the exact thing that you describe, although not to get rich quick but simply because he was kinda stupid. That’s what I figure, at least — I wouldn’t know for sure.
Either way, being the only other interested bidder, he bid considerably higher than me, I couldn’t be bothered to spend more than I wanted to, so let him have it. Then two days later, it turned out he couldn’t pay because he wouldn’t get that much of a loan (or at least that’s what he told me, might have been a lie, also don’t ask me where he got my name from, court must have told him).
So, since I also wanted that apartment, he would generously sell it to me — for a little more, just to cover court fees and tax, and well, you know.
The first thing was calling the court whether this was legitimate at all since it smelled a lot like fraud, but to my surprise, they said that it was certainly possible for me to step in, if every party, most importantly the main creditor, was happy with the agreement. The creditor was happy, of course, since getting money from me right away was easier than reaching into a naked man’s pocket, and that guy was happy, too. Only I wasn’t, yet.
My position was that I actually didn’t want the apartment that much, but generous as I was I would take it for 10% less than the bid, other guy could pay the difference as a practical learning experience, which he already had anyway by providing the security deposit. So, good news: He wasn’t going to lose anything, only he wouldn’t get back anything either. Of course, alternatively, he could try and find another more desperate buyer while time is running out on him.
Much to my surprise, he actually agreed to that, so I ended up getting the apartment I had wanted cheaper than before.