Some popular used cars are no longer affordable to average buyers
Used car and truck prices are falling according to the latest government data, however, a new report says some popular models that were once considered “affordable” are now anything but.
Robbie Marx is looking for a used van and said a van he’s asking for $16,900 is sure to sell quickly.
“When you find them, they’re gone,” he said.
Car dealer Gary Heflin, owner of Courtesy Automotive, said used car prices remain extremely high due to the continued shortage of new cars and higher prices for new cars.
“With limited supplies and higher new car prices, that drives more people back into that niche market, keeping demand up,” he said.
Online search engine iSeeCars.com recently looked at affordable used car options, comparing 2019 prices to 2022 prices of 3-year-old cars in good condition. It found that 33 vehicles no longer meet its affordability threshold.
The Toyota Rav-4, which went from $20,000 to $32,000 in three years. Nissan Maxima, which has increased from $20,000 to $30,000. The Honda CR-V, which went from $19,000 to over $30,000.
Other cars on its least affordable list include the Jeep Wrangler, Ford Edge and Chevy Traverse.
Average buyers frustrated by high used car prices
Karl Brauer of iSeeCars said ordinary Americans can’t keep up with those price increases.
“All these cars that you wouldn’t think of as special, unique, expensive cars are becoming technically unaffordable,” he said.
In many cases these days, the price of a 2 or 3 year old used car can rival the price of a brand new version of the same car. In some cases, it may be better to buy a new vehicle if you can find one and there is no markup or surcharge on it.
And with fewer new cars for sale, iSeeCars said many buyers are forced to buy 5-, 6- and even 10-year-old models.
“Maybe they’re giving less money or they’re giving a longer loan, getting a longer loan on a used car,” Brauer said.
Worse, Heflin doesn’t expect many 3-year leases this spring because three years ago, we were all on lockdown for COVID.
“We’re not seeing those rental returns come back right now,” he said.
Some hopes 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’s been well-maintained and accident-free.
He also suggests you get to know a local dealer who may be looking for used cars coming into their dealership and let you see them before the ad appears.
One bright spot: December’s Consumer Price Index shows used car prices are down 2.5% compared to November.
Experts say that if demand for cars falls in 2023, prices should ease slightly.
And that way you don’t waste your money.
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