Why do people sell their power tools?

Lots of second hand power tools are sold on Ebay every year and a surprising amount of them are still in perfect working order. Just because something is no longer needed by one person does not mean it is fit for the scrap heap.
Who sells perfectly good power tools ?
Power tools are constantly being replaced by hobbyists and their older tools are either going to gather dust in the garage or they will sell them on to help fund the new ones.
When a lot of home owners make the decision in later life to downsize there family home once their children are fully grown they suddenly realize that they may not need to do as much maintenance on their new smaller house.

What kind of second-hand tools are okay to buy?

You would generally want to stick to the larger well known brands of tools.
Names such as DeWalt, Makita, Bosch and Milwaukee.
You can find a variety of power tools available such as smaller hand held tools like jigsaws, drills and the much larger units such as table saws and welding machines. 

Just be aware that the warranty is generally void if you are not the original purchaser and as such you would not be able to make any kind of warranty claim in the event of a breakage or accident.

What to look out for when buying second-hand tools ?

Looks don't reveal everything just because a tool is all shiny and new looking does not mean that it is in perfect working order. And the reverse is also true even old battered looking tools can work just fine and may have many years of use still inthem.

Check the plug and the power cord closely as these can be points on the tool that may give you some insight as to how it has been treated 

Handles and trigger are also a good tell tale sign if a tool has be misused in the past.

If possible always test the tool. Although if you are buying online from somewhere like Craigslist or Ebay this may not be an option.

Take your time do a bi of research and try to get as much information out of the seller as possible.

With a bit of due diligence you may just snag yourself a real bargain!