You can use the auctions when you are... level 2 or 3; level 3 for private sales with 3 karma and 2 horses.
I do have to question my personal ethics today... I bought a cheap foal in the auctions (now being sold) just so I could access the private sales to get a decent foal.
I'm feeling guilty now although I kinda need the money.
The foal BTW is on the auctions at $600 --- the original owner called him 'Spunk'; I forgot to change it before putting him up for auction... oops.