As spring car buying season approaches, the new and used car markets are ripe for deal seekers. However, knowledge is certainly power in 2024. Attractive low APR offers have continued well beyond year-end sales, making new cars a potentially better deal than used ones. Additionally, the glut in new car inventory has tilted the scales, making new vehicles more negotiable. For those not keen on long-term commitments, leasing emerges as an appealing option, thanks to favorable terms spurred by the oversupply. If you’re wondering if spring 2024 is a good time to buy a car, here are three things you should know before stepping foot on a dealership lot.
1. Financing Offers Push Buyers to New Cars
If you’re on the fence about whether it makes sense to buy new or used in spring 2024, the tie-breaker may be today’s enticing new car APR offers. 2023’s year-end deals seem to have bled over into the new year, propelled by surging new car inventory, and hundreds of thousands of unsold 2023 models.
As of the latest promos, we counted no fewer than ten 0% financing offers. When you zoom out to include deals below 1.99% APR, that number grows to 21 active offers. But if you’re not paying attention, it’s easy to fall victim to today’s overall high interest rates.
Whether you intend to buy new or used, it’s important to factor in the cost of borrowing money when budgeting for your next vehicle. Despite the great incentives available today, as of the most recent data, the average new car loan rate is 9.95% APR. Used car loan rates are even higher, closing in on 14% APR.
Insurance rates have gone up, too. In 2023, car insurance premiums climbed 24%, the quickest spike in decades. In 2024, Insurify predicts that rates will climb an additional 7%. On the bright side, the US Energy Information Administration forecasts average gas prices to remain lower than in recent years. The EIA expects US gas prices to average $3.40/gallon in 2024.
All in all, it’s smart to prepare for the total cost of owning a vehicle BEFORE you buy. Take advantage of CarEdge’s free data for detailed cost of ownership rankings, with data on maintenance, depreciation, insurance, and more.
2. New Cars Are More Negotiable
Simply put, there’s a worsening oversupply of new cars right now. As we race towards spring car buying season, there’s no sign of the new car glut easing. As of today, there’s an 89-day supply of new cars in America. Typically, that figure is closer to 60 days. Some brands, such as Nissan, Jeep, Ram, and Ford, have nearly twice the average inventory. Nissan can’t seem to sell cars right now. Stellantis has been in the same boat for well over a year.
Why does inventory matter to consumers? We say it all the time: when inventory surges, deals are sure to follow. Some cars, trucks, and SUVs are more negotiable than others. Here at CarEdge, we stay on top of the latest market trends. Why do we do it? To bring you insights on where the best deals are, of course. As of today, the following new and used car segments are most negotiable, considering supply, demand, and inventory data: Electric vehicles, trucks, vans, luxury crossovers and SUVs. This is a generalization based on the model-specific inventory and deal insights available through CarEdge Data.
What about used car prices?
Used car prices are falling, albeit more so at wholesale auctions than on dealer lots. In 2023, used prices fell 7%, and are now down 21% from all-time highs in December of 2021.
Our team of CarEdge Coaches reports that used car prices are certainly more negotiable today than they were in months past, but car dealers are stubbornly resisting the downward pressure in the market, and are too often leaving price tags as-is. Don’t let that stop you from mastering car buying negotiation skills.
3. Consider Leasing to Avoid Depreciation
If you don’t expect to hold on to your next vehicle for more than five years, consider leasing to avoid the massive depreciation that comes along with buying any new car. Gone are the days of selling any used car for a profit. With the ongoing oversupply of new vehicles, it’s not just APR and cash offers that are abundant right now. Leasing deals are shockingly good this month.
When a dealer leases a car, they’re technically still making a sale. It’s just that the leased car is sold to a third party who then leases it. So in other words, automakers and dealers alike love leasing a car to you, and offer sweet deals in times of high new car supply. Here are a few of the best lease deals this month:
- Lease a Chevy Trax for $399/month with the just the first month’s payment due. See details.
- Lease a Chevy Equinox for $299/month for 24 months with $1,409 due.
- Lease a 2023 Ram 1500 Big Horn for $470/month for 36 months with $4,500 due.
Wondering if leasing makes sense for you? Check out CarEdge Co-Founder Ray Shefska’s guide to leasing versus buying in 2024.
Stay Alert, Spring Shoppers
The spring of 2024 offers compelling reasons for consumers to consider new vehicles, thanks to attractive APR offers and an oversupply that enhances negotiation potential. However, buyers should tread carefully, considering high loan rates and insurance premiums. For those looking for flexibility, leasing provides a viable path to bypass the steep depreciation of new car purchases. Remember, you can always see this month’s best APR, cash, and lease deals here. We update our resources as soon as the latest offers are announced.
👉 Looking for help, or simply want to hand over the keys and take the hassle out of car buying completely? Learn more about buying your next vehicle with CarEdge.
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