Used cars are pricing out like new cars in 2022, and that’s a problem for frustrated auto buyers.
Used car prices have reached record highs with the average one- to five-year-old used car costing $34,852, according to data from iSeeCars,
It’s no surprise that used car prices vary from state to state. iSeeCars reports that North Dakota is the state with the greatest used car price increase in 2022 compared to 2021 at 43.5%, which amounts to $11,413. Conversely, Delaware has the smallest used car price increase at 28.8%, which amounts to $7,714.
Those high used vehicle prices are leaving buyers in the dust, with prospects for price declines dimming for the rest of 2022.
“Thanks to supply and demand losing their balance following manufacturer shutdowns and part shortages, the used car market is hot,” Melanie Munson, a used car expert with CarInsuranceComparison.com, told TheStreet. “More people want cars than there are cars available, so often, multiple people compete for the same car, driving the prices of that car and competitors’ cars higher.”
Getting Up to Speed on Used Car Purchase Strategies
With used car prices on the rise, along with buyers’ blood pressure, options seem limited. That really doesn’t have to be the case, however. With a combination of diligence and creativity, you can still cut a deal on a good used auto.
Take these action steps to get your used auto purchase program in the fast lane.
Go out of state: One effective trick is to buy your car in a different state.
“If you have a vehicle model in mind, try a few Craigslist searches in cities or states near your own location,” said Shawn Plummer, chief execute officer at The Annuity Expert in Atlanta, Ga. “You may find a car for thousands less than what you’d pay locally, if you can find it at all nearby. A short trip to a neighboring region can be worth it for the price.”
Set up notifications: You can easily set up alerts on most car buying sites to inform you as soon as the model you want is in stock.
“If someone sets up a listing, they’re probably going to get multiple offers within 24 hours,” Plummer told TheStreet. “Be quickest and have your process set up. That means knowing the mechanic you’ll take it to for a pre-buy inspection, having cash in hand, and generally being the best potential buyer that a seller wants to work with.”
Look for vehicles with saved service records: If the records indicate that the previous owners took great care of the car, you’ll get a better deal even if the price is high because the car will likely have a longer life and need fewer repairs than other similar cars.
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“When you find a car listed for a good price, don’t wait,” Munson told TheStreet. “Good deals don’t last, so while you still need to be careful and have any vehicle you consider buying checked out by a trusted mechanic, you need to contact the seller right away and schedule a time to see the car as soon as
Consider cars with a rebuilt title:. While being extra careful is always a virtue, going the “rebuilt” route can pay off with a good car at a decent price.
“If the damage to the car was due to hail or something cosmetic and the alignment wasn’t tweaked, and the engine wasn’t damaged, you can get a great deal,” Munson told TheStreet.
Be flexible: It certainly pays to be flexible about the type of vehicle you’re, and not committing to a certain brand or a certain color.
“Expand your search,” said Mark Schirmer, editorial director at Cox Automotive in Ann Arbor, Mich. “A shopper may have to travel further to find a good deal that works for them. Shoppers will also have to be ready to move fast.”
Just don’t move too fast, as inspections are important. “Consequently, don’t buy a used vehicle sight unseen or without a proper test drive,” Schirmer told TheStreet. “Consider a company such as Lemon Squad, a used car inspection review platform, to help with auto inspection information.”
Know the value of your trade-in:. If you have a trade-in, get informed on its value, Schirmer advised. “The best place to get a valuation is at Kelley Blue Book Instant Cash,” he said.
Where Are Used Car Prices Going?
Should buyers wait for the market to slide back, price-wise? If so, how long will that take?
Schirmer said his team doesn’t expect prices to correct anytime soon – if ever.
“With new-vehicle inventory expected to remain tight through the remainder of the year and into 2023, we expect used vehicle price to remain elevated at the retail level,” he said. “Interest rates are going up, so there is a downside to waiting as well.”
“The smart move is to do the research online, be flexible, shop around, and be quick when you find what you want,” he said.