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It’s a new year, but car buyers are still facing some of the same challenges. In 2024, the dilemma of choosing between a new or used car is influenced by several factors, including depreciation rates, interest rates, price trends, and the lingering effects of the pandemic. Let’s break down what you need to know to make the best decision in 2024.
Key Takeaways:
For most buyers in 2024, new car deals are more sensible due to lower financing costs and attractive incentives.
Used car prices are declining but remain high, affected by the pandemic’s long-term impact on production.
New cars offer appealing financial advantages with low APR offers and manufacturer incentives, despite their higher initial cost.
The choice between new and used cars depends on individual financial situations and long-term vehicle ownership plans.
Free resources are available to guide money-conscious drivers through car buying decisions.
Buy New in 2024, But Risk Depreciation
The automotive landscape has seen dramatic shifts in trade-in and resale values over the past few years. In 2024, a trend that began last year is continuing: used car prices are declining in wholesale markets, impacting trade-in values significantly. The era of purchasing a new car and flipping it for profit is over. Instead, we’re returning to the traditional pattern where new cars lose a substantial portion of their value as soon as they leave the dealership.
Interest Rates Matter – New Cars Have Much Lower APRs
This year, expect to see an uptick in subvented rates from captive lenders, as new car sales decelerate. Low APR offers are here to stay in 2024. Manufacturers are increasingly offering incentives to clear inventory, including surprising zero percent financing deals available in January. Despite stable interest rates, the high cost of loans remains a critical factor in the car market. Consequently, we anticipate a larger share of new car loans will be sourced through captive lenders like Hyundai Motor Finance, Ford Credit, and Toyota Financial Services.
Towards the end of 2023, data from Cox Automotive showed an uptick in 0% APR offers. We expect this trend to continue into 2024.
With the average used car loan rate now north of 13% APR, plenty of used car shoppers are checking out new car offerings to simply pay less interest.
Finally, Fair Prices Are Within Reach For New Cars
Don’t pay dealer markups for any vehicle in 2024. No matter what the salesperson might tell you, we’re firmly in a buyer’s market. This isn’t 2022’s car market anymore.
After consecutive years of rising MSRPs, the tide is turning in 2024. Although prices for the latest models have increased for the 2024 model year, we don’t foresee this trend continuing once 2025 model pricing is announced.
Resistance to high prices is growing among consumers, evident in slowing sales and increasing inventory, particularly for expensive cars, SUVs, and trucks. This resistance is gradually influencing the used car market as well.
Used Car Prices Trending Downward, But Remain High
Used-car wholesale prices have given up 53% of their pandemic gains. However, wholesale markets are largely off limits to the average car buyer. Unfortunately, this drop is less pronounced in retail prices. According to the Consumer Price Index, retail used car prices have given up just 36% of the pandemic price spike two years later. Retail used car prices are down 12.6% from the July 2022 highs.
Why are used car prices still high in 2024?
The auto market is still feeling the lasting effects of the pandemic-induced semiconductor chip shortage. Pandemic-related factory shutdowns resulted in 16 million vehicles never being produced. These missing vehicles contribute to a global shortage of used cars, expected to last until at least the late 2020s. Ray Shefska of CarEdge predicts a return to normalcy in the used car market might not occur until 2030.
In 2024, used car prices will continue their gradual decline, influenced by high interest rates deterring potential buyers. With new car loan rates exceeding 13% APR, a 20-year high, many buyers are turning away from used cars in favor of new vehicles with more attractive financing options. Indeed, new car deals make more sense for many buyers in 2024.
In 2024, the Details Matter For Car Buyers
2024 presents a nuanced picture for car buyers. While new cars offer more favorable financing options and the appeal of owning a brand-new vehicle, they also come with the risk of rapid depreciation and of course, higher prices.
On the other hand, used cars, although more affordable, are still priced relatively high due to market shortages years ago. Ultimately, the decision depends on individual priorities, financial situations, and long-term plans for vehicle ownership.
Free Car Buying Help Is Here
Ready to outsmart the dealerships? We have FREE resources for new and used car buyers alike. Download your 100% freecar buying cheat sheets today. From negotiating a deal to leasing a car the smart way, it’s all available for instant download. Get your cheat sheets today!
As we step into 2024, American drivers are noticing a larger auto insurance bill with their policy renewals. Based on an analysis of 97 million auto insurance quotes from Insurify, a clear picture emerges of the key trends in car insurance prices for this year. We’ll examine the factors driving up costs, and take a look at how consumers and the industry are adapting.
Record-High Rates in 2023 Set the Stage For More Increases in 2024
In 2023, auto insurance rates in the U.S. climbed 24% to an all-time record high. The spike in rates was driven by rising repair costs, natural disasters, and more frequent car accidents. This uptick in insurance costs led to record losses for insurers. The latest data suggests that car insurance premiums aren’t done climbing. Insurify projects that car insurance rates will increase by 7% in 2024. That’s almost double the typical annual rise.
The national average cost of a full-coverage policy now stands at $2,019 per year, amounting to 2.6% of the median household income. In comparison, state-minimum liability insurance averages at $1,154 annually.
The Wage-Insurance Gap Worsens
In 2023, car insurance rates increased by 638% more than the average wage growth. Nearly 62% of Americans reported a rise in their car insurance rates, and about 22% experienced more than one increase in the same year.
To combat these hikes, many drivers opted to lower their coverage limits or increase their deductibles. Insurify’s data shows that most drivers took action to reduce their premiums, often accepting more risk in exchange for lower monthly premiums.
New York stands out with the highest car insurance costs in the country, averaging $3,374 annually for a full-coverage policy.
States with lower incomes are feeling the brunt of these insurance cost increases. Drivers in these states spend a larger portion of their earnings on car insurance, exacerbating the financial strain on households already facing economic challenges.
The Insurance Industry Is In Trouble
The past few years have been tough for the insurance industry. After suffering a $3.8 billion net underwriting loss in 2021, losses deepened to $26.9 billion in 2022. 2023’s numbers are still pending, but there were some signs of a recovery late in the year.
The rising costs of maintenance and repairs, increased severity of accidents, and pandemic-induced market fluctuations have all contributed to these losses. The Bureau of Labor Statistics reported an 8.46% increase year-over-year in auto repair costs as of November 2023.
Advanced vehicle technologies and electric vehicles bring new challenges, with repair costs for high-tech cars and EVs like Tesla being substantially higher. Insurance companies are increasingly forced to choose between writing a check for a $20,000 repair bill after a seemingly minor accident, or writing the car off altogether.
How Can Drivers Save On Auto Insurance in 2024?
In light of the rising car insurance rates, here are some practical recommendations for car buyers looking to save money on their auto insurance in 2024:
Compare Insurance Quotes: Before settling on a policy, compare quotes from multiple insurance providers. Rates can vary significantly, so shopping around can lead to substantial savings.
Increase Your Deductible: Opting for a higher deductible can lower your insurance premiums. However, ensure that you can afford the deductible in case of a claim.
Choose Your Vehicle Wisely: If you’re in the market to buy, here’s where you have a chance to make a big difference in your insurance bill. The type of vehicle you drive impacts your insurance rates. Cars that are cheaper to repair or are known for their safety features typically have lower insurance costs. Research the insurance costs for different models before making a purchase. Compare maintenance costs for new and used vehicles here.
Maintain a Good Credit Score: Many insurers use credit scores to determine premiums. A higher credit score can lead to lower insurance rates, so it’s beneficial to maintain good credit.
Drive Safely: Safe driving not only reduces the risk of accidents but can also lower your insurance rates. Many insurers offer discounts for a good driving record or for participating in defensive driving courses.
Look for Discounts: Always ask about available discounts. Common discounts include those for multiple vehicles, no claims history, low annual mileage, having safety features on your vehicle, and bundling auto insurance with other policies like homeowners insurance.
Consider Pay-Per-Mile Insurance: If you drive infrequently, explore pay-per-mile insurance options. These policies base premiums on the number of miles you drive and can be a cost-effective choice for low-mileage drivers.
By following these recommendations, car buyers can make more informed decisions and potentially save money on their auto insurance in 2024, despite the overall trend of rising rates.For more information on the latest auto insurance trends, check out Insurify’s latest update.
Free Car Buying Help Is Here!
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Why did most buyers stay away from used electric vehicles in years past? Most were fixated on the federal EV tax credit, which only applied to new EVs. Others were unsure about EV repair costs outside of warranty. But the calculus changes when used EV prices plummet like they have recently. Better yet, more and more models are qualifying for the federal used EV tax credit, which launched in January 2023. Here’s a look at the best used electric vehicle deals in December of 2023.
We’ve ranked the 10 best-selling EVs in America from most negotiable, to least negotiable based on market day supply.
Chevrolet Bolt
New Average Transaction Price: $31,482
Used Average Transaction Price: $23,601
Used Market Day Supply: 100 days
Negotiability Score: Very High
The Chevrolet Bolt EV stands out as one of the most affordable electric vehicles in the American market. It’s an ideal entry-level EV, perfect for city driving and shorter road trips. Additionally, most used Bolt EVs fall within the price caps for the federal used EV tax credit, making them even more appealing.
However, the Bolt’s main drawback lies in its charging capabilities. With a peak charging rate of only 55 kW, it can take over an hour to gain 200 miles of range, which may be a concern for some buyers. In December, there are 3,487 used Chevrolet Bolts available for sale across America, with prices starting at just $10,995. Of these, 415 boast a clean record.
The Volkswagen ID.4 boasts the advantage of being American-made at VW’s Chattanooga, Tennessee plant, making it eligible for the federal EV tax credit when new. Furthermore, used ID.4 models are available for around $25,000, potentially qualifying for the used EV tax credit as well. With charging speeds and range that are both average, it strikes a balance in the EV market.
However, the ID.4 is not designed for sporty performance; those seeking a more dynamic driving experience might consider other options on this list, excluding the Chevy Bolt. As of December, there are 655 used Volkswagen ID.4s for sale across America, with prices starting as low as $23,900, and 111 of these vehicles have a clean record
The Mustang Mach-E is a family-sized EV with the iconic Mustang’s spirit, offering a sporty edge to family hauling. However, it’s important to consider that its charging speeds are average, lagging behind competitors like Tesla, Hyundai, and Kia. For those interested, there are 1,327 used Mustang Mach-Es available for sale in America as of December, with prices starting at an enticing $23,999. Among these, 183 have a clean record.
The Model S boasts luxury features and reliable fast charging, making it a premium choice in the electric vehicle segment. However, it’s important to note that it doesn’t offer the same cargo capacity as its siblings, the Model Y and Model X, which could be a deciding factor for some.
As of December, the market has 2,498 used Model S vehicles available across America, with prices starting remarkably low at $12,000 for a 2013 model. Among the listings, 363 have a clean record.
The Kia EV6, similar to the IONIQ 5, is renowned for its rapid charging capabilities and efficiency. However, buyers should note that it offers less interior cargo space typical of hatchbacks, rather than the larger capacity found in SUVs.
In the current market, there are 397 used Kia EV6s available for sale across America as of December, with the starting price at $24,922. Among these, 75 have a clean record.
For car buyers considering a used Tesla Model Y, there are some key points to keep in mind. One of the major advantages is access to Tesla’s reliable and extensive Supercharger network, complemented by the convenience of frequent over-the-air updates that continually improve the vehicle.
However, potential buyers should be aware of occasional complaints regarding build quality issues. As of December, there are 2,226 used Model Ys available for sale across America, with prices starting as low as $27,500. Out of these, 339 have a clean record.
The Model 3 is known for its time-tested reliability, exceptional range and efficiency, and access to Tesla’s extensive Supercharger network. However, it’s worth noting that as a sedan, the Model 3 doesn’t align with the current trend favoring SUVs and trucks. In December, there are 6,591 used Model 3s on the market in America, with prices starting at an attractive $16,990. Of these, 533 boast a clean record.
The Tesla Model X combines the spaciousness of an SUV with the touch of luxury, notably featuring its distinctive gull-wing doors. While these doors add a unique flair, they can sometimes be more of an inconvenience in practical use. For those eyeing a 2020 or newer Model X, be prepared to invest a minimum of $50,000.
In the used car market this December, there are 1,391 Tesla Model X vehicles available across America, with the starting price as low as $23,100. Among these, 204 have a clean record, offering a variety of choices for those seeking a blend of luxury, space, and electric efficiency in their vehicle.
The Hyundai IONIQ 5 stands out in the EV market with its e-GMP powertrain, making it one of the fastest-charging affordable electric vehicles available today. Additionally, several listings now fall within the negotiation range of the $25,000 price cap for the federal used EV tax credit, making it an attractive option for budget-conscious buyers.
However, its design is polarizing, often eliciting strong opinions; you either love its unique look or don’t. As of December, there are 389 used Hyundai IONIQ 5s for sale in America, with prices starting at a competitive $22,758. Of these, only 73 have a clean record.
The Ford F-150 Lightning stands out as a full-sized electric truck capable of handling typical truck duties, a significant pro for those needing utility and eco-friendliness. However, like all electric trucks currently on the market, it experiences a significant reduction in range while towing, losing about half of its rated capacity.
Additionally, the F-150 Lightning’s charging speed is not the fastest; without access to home or workplace charging, adding 200 miles of range at a DC fast charger could take at least 45 minutes.
Ford dealers are resisting discounts, even after months of building inventory. That’s the sole reason why the F-150 Lightning isn’t ranked higher on this list of best used EV deals. In the used market, there are 516 F-150 Lightnings available for sale across America as of December, with prices starting at $39,995. Of these, only 56 have a clean record, offering options for those looking for a capable electric truck with practical utility.
Ready to outsmart the dealerships? Download your 100% freecar buying cheat sheets today. From negotiating a deal to leasing a car the smart way, it’s all available for instant download. Get your cheat sheets today!
As we wrap up summer and head into fall, the truck market is full of deals. With 2025 models arriving daily and dealers eager to sell remaining 2024 inventory, it’s a great time for negotiating, or letting us do it for you. Here’s our guide to the top truck deals of September 2024, featuring low APR financing, cash offers, and lease deals.
2024 Nissan Titan
Starting MSRP: $40,350+
Negotiability Score: Very High (134 days of market supply)
0% APR financing for 60 months + up to $6,590 in cash savings
Nissan is fighting hard for truck market share in the U.S., with limited success. September’s zero percent financing offer is the best truck deal today. Plus, there are various cash offers that can total up to $6,590 in savings. Note that some of the cash incentives are only available as loyalty cash to current Nissan or Infiniti owners and lessees. This offer expires on 9/30/2024.
Negotiability Score: High (202 days of market supply)
2024 Ram 1500: Up to $7,250 cash allowance on select V6 trucks
2024 Ram 1500 Classic: Up to $5,000 cash offer
Ram trucks are slow-selling, even though they seem to be everywhere you look on the road. To alleviate Ram’s oversupply of trucks, they’re offering big cash offers this month. This offer expires on 9/30/2024.
Negotiability Score: High (96 days of market supply)
1.9% APR for 36 months, or lease for $409/month for 36 months with $4,949 due
With 96 days of market supply, there’s an abundance of 2024 Silverado 1500s on Chevy dealer lots. These APR and lease offers are great deals for truck fans. This offer expires on 9/30/2024.
Download your 100% freecar buying cheat sheets today. From negotiating a deal to leasing the smart way, it’s all available for instant download. Ready to let a car buying pro take the wheel?CarEdge Concierge is the easiest way to buy a car today. Our team finds the vehicle you want, right down to the finest of details, and negotiates on your behalf. Home delivery is available. Learn more about CarEdge’s car buying service.
As 2023 winds down, the new car market is ripe with opportunities for big savings. As inventory climbs and 2024 models arrive, dealers and OEMs have an added sense of urgency to sell cars. We’ve gathered the best year-end deals in 2023, spotlighting the top picks for drivers looking to upgrade without breaking the bank.
The CX-5 comes with standard all-wheel drive, a rarity outside of Subaru. A flood of 2024 model year CX-5s have recently arrived at dealership lots, and with zero percent financing, it’s clear that Mazda is looking to sell them in a hurry. Mazda also has several models at 0.9% to 1.9% APR in December.
$6,500 purchase allowance + $1,500 engine credit for the Elevation trim with the Turbo High-Output Engine for a total of $8,000 in cash incentives.
According to the fine print, buyers must be the current owner or lessee of a GMC or Buick vehicle to qualify for this year-end truck incentive. Costco members get an additional $1,000 in cash incentives.
0% APR for 60 months + no payments for 90 days + $3,000 bonus cash
The 2024 Hyundai Tucson also qualifies for 0% APR this month. Next year, the Santa Fe will undergo a controversial facelift, bringing unconventional looks to this popular SUV.
The 2023 Kia EV6 is one of the fastest charging EVs on the market. The EV6 won several awards last year, and has stellar ratings from Consumer Reports. This offer compensates for the loss of the federal EV tax credit, but state and local incentives may still apply.
0% APR for 36 months for the 2023 and 2024 Altima, + $500 Nissan loyalty cash
Altima sales were up 35% in 2022, giving Nissan a shot at recovering from years of market share losses to Toyota and Honda. Following efficiency upgrades, the Altima gets up to 39 miles per gallon on the highway.
At CarEdge, December is the highlight of our year. It’s a time when high vehicle inventories merge with attractive year-end deals, and with the potential rise in financing rates on the horizon, it presents a prime opportunity to land an amazing deal on a new car. These 5 top picks represent incredible value. You could even call it a buyer’s market (for this month, at least).
Ready to outsmart the dealerships? Download your 100% free car buying cheat sheets today. From negotiating a deal to leasing a car the smart way, it’s all available for instant download. Get your cheat sheets today!
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