Used car and truck prices are dropping, according to the latest government data.
However, a new report says some popular models once considered to be “affordable” are now anything but.
Robbie Marx is looking for a used van, and says one he was looking over for $16,900 will probably sell fast.
“When you do find them, they are gone,” he said.
Auto dealer Gary Heflin, owner of Courtesy Automotive, says used car prices remain frustratingly high, due to continued new car shortages and higher prices on new cars.
“With limited supplies and higher new car prices … that pushes more people back into that preowned market, keeping demand up,” he said.
The online search engine iSeeCars.com recently looked at affordable used-car options, comparing 2019 prices to 2022 prices of three-year-old cars in good condition.
It found 33 vehicles no longer meet its “affordable” threshold.
- The Toyota Rav-4, which increased from $20,000 to $32,000 in three years.
- The Nissan Maxima, which is up from $20,000 to $30,000.
- The Honda CR-V, which zoomed from $19,000 to over $30,000.
Other cars on its less affordable list include the Jeep Wrangler, Ford Edge and Chevy Traverse.
Average buyers frustrated by high used car prices
Karl Brauer of iSeeCars says average Americans can’t keep up with those price hikes.
“All these cars that you wouldn’t think of as special, unique, expensive cars are technically becoming non-affordable,” he said.
In many cases these days, the price of a used two- or three-year-old car can rival the price of a brand-new version of the exact same car.
In some cases like that, you might be better off buying new — if you can find one, and there is no markup or surcharge placed on it.
And with fewer new cars on the lot, iSeeCars says many shoppers are forced to buy five-, six-, even 10-year-old models.
“Maybe they’re also putting less money down or they’re making a longer loan, taking out a longer loan on a used car,” Brauer said.
Worse, Gary Heflin is not expecting many three-year-old lease trade-ins this spring, because three years ago we were all in COVID lockdown.
“We’re not seeing those lease returns coming back in right now,” he said.
Some hope for the future
So what can buyers do? Heflin says don’t be afraid of a higher mileage car if the CARFAX report shows it has been well-maintained and is accident-free.
He also suggests you get to know a local salesperson who can be on the lookout for used cars coming into their dealership, and let you see them before the ad goes up.
One bright spot: December’s Consumer Price Index shows that used car prices are down two-and-a-half percent compared to November.
Experts say if demand for cars drops in 2023, prices should ease a bit.
And that way you don’t waste your money.