Make the Most of Falling Prices For Used Cars

Prices for used cars have been rough the last few years. Low inventory, high prices, and rising interest rates have made the market more volatile than usual.

Compared to previous years when shoppers expected to find a good deal on used cars, the last few years have been discouraging. However, there appears to be some light at the end of the tunnel.

Record High Prices Have Dropped

In the third quarter, the average transaction for used cars was $28,935. That number is still far over the average from five years ago of $20,085. However, it has dropped from the record high last year. New vehicle prices are also continuing to rise, which makes used cars more appealing for those with a tighter budget.

If you’re shopping for used cars, the best thing you can do is do your research and make sure you’re getting the best value for your money. Finding out if you’re getting a fair price on a used car isn’t as difficult as you might think. Multiple sites exist that show comparisons between the price you’re looking at and other used cars in your area.

By searching for the make and model you’re looking at, you’ll quickly find out if you’re paying market value for the vehicle, or if you’ll be paying more. Instead of driving around to local dealerships, it’s better to check their online inventory first to see what they have.

Consider Different Brands and Models

In times past, you probably had a usual approach of looking at a specific brand, age, and mileage. However, these days, you’ll likely need to reconsider by opting for an older model with more mileage. This might necessitate looking at a more reliable brand than you normally would as well. It’s also important to get a vehicle history report and a pre-purchase inspection from a reputable mechanic.

If you’re unable to reconsider an older vehicle and are looking at used cars only a few years old, then you might want to look at a different type of vehicle or brand to save money. For example, trucks and SUVs are generally a lot more popular than sedans or subcompact crossovers. If you don’t actually need a truck or SUV, then you can save money by going smaller.

At the same time, there are brands that offer more affordable vehicles than other brands. Instead of higher-priced Japanese and European imports, consider domestic brands like GM and Ford, as well as Korean brands.

Shop For Lower Interest Rates

Getting the lowest interest rate that you can find for used cars is key to lowering your monthly payment. Instead of limiting yourself to what’s offered at the dealership, you should consider shopping at your local bank, credit union, or even an online lender. Then you can compare the rates to ensure that you’re getting the best deal.

If you currently own a car with equity, then you’re already ahead as used car prices remain comparatively high. That means you can get more for your car and offset the price of your next vehicle. Again, it’s important to shop around for vehicle appraisals before taking it to the dealership.

The most difficult part about shopping for used cars right now is finding a certified pre-owned vehicle. There’s simply not much inventory to go around. But if you find one that fits your budget, you should jump on it.