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Used car prices have increased more than 50% in 2021. Historically, used cars decrease in value. You know the old saying about buying a new car? “The moment you drive off the lot, it’s worth 20% less.” Well, in today’s crazy market, the moment you drive a new car off the dealer’s lot it might actually be worth 20% more!
The ongoing chip shortage and undersupply of new vehicles is driving used car prices higher. Rental car companies, car dealers, and consumer demand are keeping prices elevated. Until new car inventories rebound to pre-pandemic levels, we’ll see elevated used car pricing.
With more and more consumers not returning their leases, fewer quality used cars are making it to the market. If your lease is coming due, please do not just return it to the dealer, instead, sell it for a profit. You would be leaving money on the table!
We also track new car prices and inventory levels. Our hope is that we can help you make an informed decision when it comes time to purchase your next vehicle.
This page will be updated weekly with new data from Black Book, Cox Automotive, and other sources.
If you have specific questions about used car prices please ask them on the CarEdge Community Forum.
Wholesale used car price increases show no signs of slowing down. The latest data from Manheim and Black Book show wholesale and retail used car prices hitting all-time record highs. Manheim’s used vehicle value index chart paints and eery picture; the data almost looks fake.
Data from Black Book suggests that wholesale used car prices have increased more than 50% since the beginning of this year. The purple line shows 2021 used car price changes. The blue line represents 2019. The differences are stunning.
Wholesale prices are not the only ones going up. Used car retail prices are also hitting all-time highs. Black Book data shows retail used car prices have increased nearly 35% since the beginning of the year. Traditionally the end of the calendar year is when used car prices decrease. That is not the case right now.
One positive indication in the data comes from Cox Automotive. They reported that inventory levels in October were up 20,000 units from September. September ended with 2.28 million used vehicles in inventory, while October ended with 2.30 million. October’s supply was still about 8% lower than 2020.
Cox also estimates that the days supply of used car inventory is at 42. Their data suggests that about 1.65 million used vehicles were sold in October 2021, up 40,000 units from the 1.61 million sold in September. October sales ran about 7% below the same year-ago period.
Both Cox and Black Book show retail used car prices hitting all-time highs. Cox has the average listing price for used vehicles at a new record of $26,971. That’s a $400 increase from September ($26,548).
Week-over-week Black Books has reported another increase in wholesale used car, truck, and SUV prices. The latest weekly increase was .41%. The price increase among trucks, SUVs, and vans was greater than car price increases.
This shows last weeks wholesale used car, truck, and SUV price gains.
Used car prices will continue to appreciate as long as automakers are struggling to produce enough new vehicles. We track new car inventory levels monthly. The latest new car inventory data for December is not promising.
That being said, many manufactures, including Toyota have signaled that the worst of the chip shortage is behind them. Other manufacturers, such as General Motors, are removing core features from their new vehicles in an effort to ship them to their dealers.
It’s unclear whether we’re “on the other side” of the chip shortage yet, and our expectation is that used car prices will continue to rise until it is more clear that the new car shortage is alleviated.
Used truck, SUV, and van prices 2021
Not all used cars are appreciating equally. Used trucks, SUVs, and especially vans are increasing at rapid (and unbelievable) rates. Look at the data provided by Manheim and Black Book below.
Black Book data shows that just last week used compact van prices increased over 2.5%. That’s UNHEARD of. These are your Ford Transit Connects, Mercedes-Benz Metris, Ram ProMaster City, and Nissan NV200.
Compact and sub-compact crossovers increased nearly 1% week-over-week.
As you can see, the data from Manheim also shows vans leading the way in terms of price increase.
Used car prices 2021
Certain used cars are increasing in value more rapidly than others. For example near luxury cars (think your Genesis and Acuras) are increasing rapidly week-over-week. The same goes for prestige luxury cars like your BMWs, Mercedes-Benz, and Audis.
Black Book provides “sales rate” data from the wholesale used car auctions.
Directly from Black Book:
The weekly estimated average sales rate has remained stable at the 70% mark for the 2nd week in a row. This time last year, the estimated average weekly sales rate was around 51%, so while floor prices continue to rise, buyers continue to purchase vehicles at auction at a higher rate.
Typically the holiday season signals an increase in newer used vehicles. This is because of lease returns and rental vehicles coming to the auction. This year that is not happening to previously expected levels. While there was a slight uptick in newer model year vehicles rolling across the lane this past week, a significant portion of vehicles are arriving damaged.
Franchise car dealers are grounding lease returns and not sending them to auction. Fierce competition at the auctions can be mostly attributed to large independent dealerships and rental companies. Because of inventory scarcity, we have seen bidding wars across the country. Wholesale values and floors continue to increase and give no indication of slowing down.
We’ve heard stories from our community of similar experiences at the auction, and it appears that rougher and rougher vehicles are crossing the auction block at this time.
Are any used cars depreciating?
No. From all of the data we’ve been able to get our hands on, it looks like there isn’t a single style of vehicle or particular nameplate that is not increasing in value right now. We know that certain vehicles are appreciating less than others, however all vehicles are increasing in value right now.
Luxury vehicles, and in particular luxury SUVs are appreciating much less rapidly than other vehicles. Take for example the Mercedes-Benz GLC, it has only appreciated 8% year over year. This further reinforces the theory for why the Mirage has increased in value nearly 50%; consumers need affordable and attainable used cars, not expensive and luxurious ones.
How long will used car prices keep going up?
Although our crystal ball has been notoriously cloudy here at CarEdge, we feel confident in saying that used car prices will continue to increase well into 2022. Even when automakers get production back up to speed for new vehicles, there will be lingering effects from this period of time where they have not been able to produce at expected capacity.
Also, the price to produce new vehicles has gone up. As a result of the chip shortage (and other supply chain issues), we expect MSRP on new vehicles to be considerably higher than before. Why? Because the manufacturers costs are increasing, and they will likely pass that along to the consumer. As a result, the demand for used cars will continue to be high because used cars (especially vehicles like the Mitsubishi Mirage) will be the only “attainable” price point vehicles for many people.
For these reasons, we think week over week, and month over month used car price increases will continue for at least another 12 months.
When should I sell my used car?
If used car prices are likely going to continue to appreciate, it would make sense to hold onto your used vehicle and wait to sell it. That being said, our best recommendation is to track the value of your used vehicle weekly. To do this we encourage you to use the “value my vehicle” section of your CarEdge account. You should also get quotes from Carvana, Vroom, CarMax, etc.
There may be small fluctuations in price from week to week, but we expect the price of your vehicle to gradually increase overtime. The indicator for when to sell will be when you see week over week declines in the value of your vehicle.
If You’re Buying a Used Car …
Our recommendation has been, and will continue to be to stop buying cars! We’re so passionate about this that we even made a website: http://stopbuyingcars.com/
However, if you need to buy a used car right now, here’s what you need to remember.
How to value if it’s a fair deal
The only way to know if you’re getting a fair deal is to get the out-the-door price from the seller and then compare that to the vehicle’s value. To get the out-the-door price follow this guide:
To know if the vehicle’s price is fair, we encourage you to run the VIN through the CarEdge vehicle valuation page and to also get a quote from Carvana to see what they would pay to buy the car right now. If the Carvana quote is close to what you are paying for the vehicle, then it’s likely a pretty fair deal.
Get a pre-purchase inspection
In today’s market, with “rougher” used cars for sale it is critically important that you get a pre-purchase inspection done on the vehicle you are thinking of purchasing. We have heard too many horror stories of people buying used cars “as-is” and then getting stuck with a piece of junk. Avoid that, and get a PPI!
Consider an extended warranty from CarEdge
Last but not least, consider getting an extended warranty on your used vehicle. CarEdge partnered with AUL Corporation to sell extended warranties with a flat markup, transparent pricing, and free consultations with an Auto Advocate. If we can help you protect your use car, we want to. More on that here: https://caredge.com/extended-warranty/ and request a free quote here: https://app.CarEdgemember.com/service-contract
Through the ups and downs of the auto market, one thing remains the same: every state has a documentation fee. Also known as a doc fee, this isn’t like the other fees you’ll encounter. Be sure to familiarize yourself with what car dealer fees you should and shouldn’t pay.
The price of a car is never what it seems. There’s the selling price, the fees, the add-ons, and taxes. When it’s all said and done, you end up with the out-the-door price, and one of the line items you’ll see on your purchase agreement is a “doc fee”. Car dealer doc fees show up on EVERY car deal, and on this page we’ve aggregated all the car dealer doc fees by state for 2025.
Some states (like California and New York) cap the dealer doc fee. Others, such as Florida, don’t cap the doc fee. We’ve gathered the average doc fee that you should expect a dealership to charge in every state. If a dealer is charging more, you should try to negotiate the price down.Download this FREE negotiation cheat sheet!
Car Dealer Doc Fee by State – 2025
We’ve also included the average title and registration fee you should expect to pay in each state.
In today’s market you will likely not be able to negotiate the dealer doc fee. That being said, we have this complete guide to car dealer fees you should never pay.
You can find this data incorporated into our out the door price (OTD) calculator. When you are shopping for a new or used car it is important that you understand the total “out the door” price that you will be paying. Dealers like to get you to talk about monthly budget, however the most important things is to negotiate the OTD price.
When Buying a Car Out of State, Where Do You Pay Registration Fees?
Registration fees and taxes are generally paid in the state where you reside and where the vehicle will be titled and registered. If you buy from a dealership, they may collect your home state’s taxes and registration fees at the time of purchase and handle the paperwork for you. This saves you lots of time and hassle. If the dealer doesn’t handle it, you’ll need to register the vehicle yourself at your local Department of Motor Vehicles (DMV) or equivalent agency. Unfortunately, vehicle registration fees are not negotiable, and are set by state law.
Here’s a look at vehicle registration fees by state as of 2025:
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Can a car dealer charge you more than the manufactures suggested retail price (MSRP)? If you live in the United States, the answer is an emphatic “yes,” and ever since the great chip shortage of 2021 (yes, we are naming it that), more and more car dealers have increased their new car selling prices well above MSRP.
Today we’ll walk you through the laws that allow car dealers to sell their inventory at thousands, tens of thousands, and hundreds of thousands above MSRP. These laws protect dealers to markup their inventory to levels well beyond MSRP. We’ve included a bonus “craziest markups” section at the bottom of this post to give you some context as to how out of control new car pricing currently is.
In this post we’ll also give you some suggestions for how you can find dealers that are not marking their new cars over MSRP, as well as the “word tracks” you can use when trying to negotiate with a salesperson or sales manager.
Without further adieu, let’s dive in!
How can a car dealer charge more than MSRP?
Many goods are sold by manufacturers through their network of dealers or agents. Think about insurance as an example. Many insurance products are sold by an agent, who is simply a licensed producer that represents an insurer. Could you buy insurance directly from the insurer? Sure, some companies allow for that, but not all. Many insurance companies don’t want to have to deal with selling their own product. As strange as that sounds, it’s pretty common, and instead of selling directly to consumers they employ agents to do that for them.
The same dynamic applies in retail automotive. Can you buy a car directly from a manufacturer? Yes. Do most manufacturers not sell directly to consumers because they don’t want to deal with all that it entails? YES. The hassle of dealing with customers, plus franchise dealer laws in all 50 states make it an easy decision for automakers to leverage their dealer partners to sell cars. That being said, there is certainly a wind of change. There are currently 13 states there have been proposed laws to allow for automakers to sell directly to consumers.
So long as most new cars are sold through dealers, the dealers will have their discretion to price their inventory however they’d like. MSRP does stand for manufacturers suggested retail price after all. At the end of the day, the franchise dealer model is simple:
The automaker is responsible for producing the vehicle. The dealer is responsible for selling the vehicle. The bank is responsible for financing the purchase of inventory for the dealer. The customer is responsible for negotiating and purchasing the vehicle.
Within the franchise agreements that dealers sign with their OEMs they do not have rules that prevent them from marking up vehicles beyond the suggested retail price. If automakers wanted to be consumer advocates and cap the price of their vehicles, they could do this by simply adding and enforcing a price cap rule with their dealer body.
This will likely never happen. Why? Because gross profit on new cars has never been higher (upwards of 16% for Lithia Automotive), and automakers and dealers alike are enjoying this new reality. If automakers attempted to stop their dealers from selling above MSRP they would be picking a fight with their best customer (remember, the dealer buys the inventory from them!).
Common Add-ons & Accessories
Some dealerships refuse to sell their cars for more than MSRP. That’s great. The issue is that they add all sorts of add-ons and accessories to a vehicle that you didn’t ask for. Here’s a perfect example of that from a Land Rover dealership:
In this case the dealer discounted their price by $1,000. That’s awesome! Then they added $3,769.41 in accessories and add-ons 🙁
The accessories they added are:
Advanced Ceramic Tech for $1,695
Lojack for $1,195
Nuvinair for $299
Protection Pack for $580
Our recommendation in this case (and in the current market) would be to negotiate the cost of the accessories down to the dealer’s cost. The dealership incurs a cost to their service department to install these products. That cost is likely a few hundred dollars (refer to the table below). With that in mind, you’ll want to ask for the RO (repair order) they issued for the installation of the accessories.
Item
Cost to Dealer
Retail Price
Dealer Profit
Interior protection
$50
$500
$450
Paint protection
$100
$850
$750
Undercoating
$200
$700
$500
Rustproofing
$50
$800
$750
Car alarm
$300
$800
$500
VIN etching
$75
$400
$325
Lojack
$325
$1,000
$675
Nitrogen-filled tires
$35
$250
$215
Window tinting
$25
$300
$275
Additional Dealer Markup
Many car dealerships are selling their new cars above MSRP, and they aren’t shy about it. Every new car comes with a window sticker, also known as a Monroney Label. Many dealers are adding additional stickers to new cars with their additional dealer markup. Here’s an example:
In this case the dealership added both add-ons (Theft Patrol, Perma Plate, and Mobile Clear Shield Package), and a “Market Price Adjustment” of $10,000. The market adjustment is additional dealer markup. You get nothing in exchange for having paid an additional $10,000. It is pure profit for the dealership.
How to negotiate when the car is over MSRP
What can you do when a new car is for sale over MSRP? How can you negotiate a lower price? Well, as always, remember “if it’s taxable, it’s negotiable.” That means if it’s taxed on the bill of sale, you can negotiate its price.
When it comes to additional dealer markup and add-ons we encourage you to not settle for what the dealer is asking for. Dig your heels in a bit and try and get some money back in your pocket. Just because they are asking for $10,000 in additional markup doesn’t mean they won’t accept $5,000.
If the dealer is adamant about their pricing and won’t budge, consider factory ordering a new vehicle. When you factory order you can get a legally binding signed buyers order for the agreed upon selling price at the time you place the order.
Head to Deal School!
If you found this article helpful, you will likely benefit from our 100% free Deal School course. You can access Deal School for free here: https://caredge.com/deal-school/
The craziest car dealer mark ups
Thanks to the CarEdge Community, we have received dozens of reports of insane dealer mark up. Here’s a collection of some of the most egregious cases:
2023 Update: Major revisions to the EV tax credit were signed into law as part of the Inflation Reduction Act of 2022.
Here’s what you need to know about the latest EV tax credit revision proposal:
The 200,000 sale cap is replaced with an expiration date of December 31, 2032.
It will bring the tax credit back for Tesla, GM, Toyota and all other EV automakers, but only if strict requirements are met.
Vans, SUVs, and trucks with MSRPs up to $80,000 qualify. Electric sedans priced up to $55,000 MSRP qualify.
The tax credit will remain at $7,500, however it is now divided into $3,750 for battery mineral sourcing and $3,750 for battery component sourcing.
Final assembly must be in the United States, Canada or Mexico as soon as the bill is signed into law.
Battery minerals must be at least 40% sourced in the US or countries we have free trade agreements with until 2024, when it will begin to increase incrementally by 10% through 2028.
Battery components must be at least 50% sourced in the US or countries we have free trade agreements with until 2024, when it will begin to increase incrementally by 10% through 2028.
It will become income-limited to individual tax filers with adjusted gross incomes of $150,000 or less, and joint filers with incomes of $300,000 or less.
The tax credit can be implemented at the point of sale instead of on taxes beginning on January 1, 2024. This effectively makes it a rebate. Before this date, it remains a tax credit.
Used EVs would now be eligible for a $4,000 federal tax credit, wit a price cap of $25,000. Used EVs must be at least two years old, and the used credit can only be claimed once in the life of the vehicle.
Tax filers can claim only one used EV tax credit every three years.
Plug-in Hybrids (PHEVs) are eligible, but must meet the same strict requirements above.
The Transition Rule allows for buyers with a “written binding contract” signed before the Inflation Reduction Act is signed into law to claim the original $7,500 credit. This includes any models that will lose the credit with the revision.
As you can see, the EV tax credit is becoming a lot more complicated.
All 755 pages of the Inflation Reduction Act can be read here. The EV tax credit begins on page 381.
The EV tax credit update is not all good news. Several popular electric models would be kicked out of the tax credit until assembly, battery production and raw materials sourcing happens in North America.
These are electric vehicles that would not qualify for the tax credit under the proposed revision:
Tesla Model 3 (too expensive, RWD batteries produced overseas)
Tesla Model S and Model X (too expensive)
Rivian R1T and R1S (too expensive)
Lucid Air (too expensive)
Hyundai IONIQ 5 and Genesis GV60 (produced in Korea)
Hyundai Kona and Kia Niro electrics
Kia EV6 (produced in Korea)
Nissan Ariya (produced overseas)
Volvo and Polestar EVs (produced in Europe)
Fisker Ocean (produced in Europe)
Toyota bZ4X (produced overseas)
Subaru Solterra (produced overseas)
Official eligibility is a moving target it seems. We recommend checking the latest updates directly from the U.S. government at fueleconomy.gov for a list of eligible vehicles.
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In 2023, current EV tax credits are nonrefundable, meaning the best you can get from the current EV tax credit is cancelling out other federal income taxes you owe, with no refund beyond that. The revised electric vehicle tax credits will become refundable beginning in 2024, meaning you could potentially get money back from the government for simply buying an EV.
The Build Back Better Act would have increased the maximum electric vehicle tax credit to $12,500, however it was defeated in Congress. The BBB EV tax credit provisions controversially included an additional $4,500 incentive for EVs assembled at unionized plants.
The original EV tax credit in place from 2009 to August 2022 took away the incentive once an automaker sold 200,000 EVs or PHEVs. For this reason, Tesla and GM had lost eligibility, but are now getting it back (as long as vehicles remain under the price caps).
EV tax credit income limits
The new clean vehicle credit establishes the following income caps based on adjusted gross income (AGI):
$150,000 for single filers
$225,000 for head of household filers
$300,000 for joint filers
EV tax credit price caps
Sedans are capped at $55,000
SUVs and trucks are capped at $80,000
Once the used EV tax credit begins in 2024, it is capped at $25,000
What vehicles qualify for the new EV tax credit?
Great news for Model Y buyers, but bad news for fans of the IONIQ 5, EV6 and several other foreign-made electric cars. The Inflation Reduction Act’s Clean Vehicle Credit returns incentives to some, and takes incentives away from others.
The Tesla Model Y will qualify for the new tax credit, as long as price remains below $80,000.
The RWD Model 3 will qualify IF Tesla sources batteries from the US or Free Trade Agreement countries. Right now CATL from China makes their LFP batteries.
GM electric vehicles such as the Bolt EV and EUV will again qualify.
The Mustang Mach-E will qualify, as long as batteries are sourced from Free Trade Agreement countries.
Kia and Hyundai EVs will NOT qualify until they are assembled in North America.
Used car prices typically follow seasonal patterns. Winter, and the fourth quarter are traditionally when the used car market experiences most of its yearly depreciation. So far, in this fourth quarter of 2021 used car prices have appreciated 5%.
We all know that used car prices have been increasing this year, and the latest data from Black Book suggests we’re going to continue to see used car values appreciate through the end of this year. That being said, we are starting to see some mixed signals from other data providers. Cox Automotive recently shared data that used car inventory levels have increased in November. Although used car prices have continued to increase, we could potentially be seeing a softening in the market if inventory levels continue to rise.
In this post we’ll run through the latest data on used vehicle values. We will update this page weekly as we get new data and information to share. If you have specific questions about used car prices please ask them on the CarEdge Community Forum.
Wholesale used car prices have continued to increase. Data from Black Book shows that wholesale used vehicle prices have appreciated 48% in 2021 alone. The purple line represents 2021 wholesale weekly price changes. The blue line represents 2019 (the last “normal” year) of data we have. You can see drastic differences between the two lines.
As wholesale prices have continued their ascent, retail used car prices have followed suit. Retail used car prices are up more than 33% since the beginning of this year. Again, look at the purple (this year) and blue (2019) lines in the graph below. It’s incredible to see the stark difference between the two.
That being said, wholesale used car inventory levels have ticked up so far in November. Data from Cox Automotive showed positive signs in terms of inventory with October inventory levels up 200,000 units from September. September ended with 2.28 million used vehicles in inventory, while October ended with 2.30 million. October’s supply was still about 8% lower than 2020.
Cox also estimates the days supply of used car inventory. It is at 42 for the month of October, the same as September. Their data suggests that about 1.65 million used vehicles were sold in October 2021, up 400,000 units from the 1.61 million sold in September. October sales ran about 7% below the same year-ago period.
Both Cox and Black Book show retail used car prices hitting all-time highs. Cox has the average listing price for used vehicles at a new record of $26,971. That’s a $400 increase from September ($26,548).
One of the most interesting data points Black Book tracks is used vehicle retail listings volume. This means how many used vehicles are listed for sale in the United States each week. Data from Cox suggests inventory levels are edging higher, and Black Books data shows the same thing. We see a slight week-over-week increase in retail listing volume.
Again, the purple line represents this year, and the blue line shows 2019. Typically we would see an increase in retail listing volume at this time of year, however right now the volume is still low and not increasing. This simply means there are less used vehicles for sale than earlier in the year, and the lowest level we’ve seen so far this year.
That being said, we did see another week of wholesale price increases, our 13th straight week of appreciation. Last week cars appreciated .70%. This week that sunk down to .13%. Trucks and SUVs increased .61% last week, and increased modestly by .21% this week. The used car market as a whole was up .18%, considerably lower than last week.
This shows last weeks wholesale used car, truck, and SUV price gains.
Toyota’s new car sales volume was down 29% in October. Toyota’s biggest sellers posted double digit declines in sales volume in October: Camry down 40 percent; RAV4 down 39 percent; Tacoma sales declined 38 percent; Highlander off 19 percent and Corolla sales off a staggering 61 percent.
It wasn’t just Toyota. Honda sales volume dropped 24% in the month too.
Used car prices will continue to appreciate as long as automakers are struggling to produce enough new vehicles. These recent earnings reports highlight how much the major manufacturers are struggling to stock their dealer’s lots.
What types of cars are increasing in value the most?
Black Book supplies us with compelling data on the change in used car prices broken down by segment of vehicle. This past week compact cars appreciated in value the most. These are your Subaru Imprezas, Ford Fiestas, Nissan Versas, Mazda Mazda3s, Ford Focus, etc.
Sporty cars are finally depreciating! This time of year is seasonally when sports cars depreciate the most.
Compact vans and full-size vans continue to increase in value rapidly. Their value increased well over 1% week-over-week. Full-size vans have increased in price 42 out of the past 43 weeks.
Black Book provides “sales rate” data from the wholesale used car auctions.
Directly from Black Book:
The weekly estimated average sales rate has remained stable at the 70% mark for the 2nd week in a row. This time last year, the estimated average weekly sales rate was around 51%, so while floor prices continue to rise, buyers continue to purchase vehicles at auction at a higher rate.
Typically the holiday season signals an increase in newer used vehicles. This is because of lease returns and rental vehicles coming to the auction. This year that is not happening to previously expected levels. While there was a slight uptick in newer model year vehicles rolling across the lane this past week, a significant portion of vehicles are arriving damaged.
Franchise car dealers are grounding lease returns and not sending them to auction. Fierce competition at the auctions can be mostly attributed to large independent dealerships and rental companies. Because of inventory scarcity, we have seen bidding wars across the country. Wholesale values and floors continue to increase and give no indication of slowing down.
We’ve heard stories from our community of similar experiences at the auction, and it appears that rougher and rougher vehicles are crossing the auction block at this time.
Are any used cars depreciating?
No. From all of the data we’ve been able to get our hands on, it looks like there isn’t a single style of vehicle or particular nameplate that is not increasing in value right now. We know that certain vehicles are appreciating less than others, however all vehicles are increasing in value right now.
Luxury vehicles, and in particular luxury SUVs are appreciating much less rapidly than other vehicles. Take for example the Mercedes-Benz GLC, it has only appreciated 8% year over year. This further reinforces the theory for why the Mirage has increased in value nearly 50%; consumers need affordable and attainable used cars, not expensive and luxurious ones.
How long will used car prices keep going up?
Although our crystal ball has been notoriously cloudy here at CarEdge, we feel confident in saying that used car prices will continue to increase well into 2022. Even when automakers get production back up to speed for new vehicles, there will be lingering effects from this period of time where they have not been able to produce at expected capacity.
Also, the price to produce new vehicles has gone up. As a result of the chip shortage (and other supply chain issues), we expect MSRP on new vehicles to be considerably higher than before. Why? Because the manufacturers costs are increasing, and they will likely pass that along to the consumer. As a result, the demand for used cars will continue to be high because used cars (especially vehicles like the Mitsubishi Mirage) will be the only “attainable” price point vehicles for many people.
For these reasons, we think week over week, and month over month used car price increases will continue for at least another 12 months.
When should I sell my used car?
If used car prices are likely going to continue to appreciate, it would make sense to hold onto your used vehicle and wait to sell it. That being said, our best recommendation is to track the value of your used vehicle weekly. To do this we encourage you to use the “value my vehicle” section of your CarEdge account. You should also get quotes from Carvana, Vroom, CarMax, etc.
There may be small fluctuations in price from week to week, but we expect the price of your vehicle to gradually increase overtime. The indicator for when to sell will be when you see week over week declines in the value of your vehicle.
If You’re Buying a Used Car …
Our recommendation has been, and will continue to be to stop buying cars! We’re so passionate about this that we even made a website: http://stopbuyingcars.com/
However, if you need to buy a used car right now, here’s what you need to remember.
How to value if it’s a fair deal
The only way to know if you’re getting a fair deal is to get the out-the-door price from the seller and then compare that to the vehicle’s value. To get the out-the-door price follow this guide:
To know if the vehicle’s price is fair, we encourage you to run the VIN through the CarEdge vehicle valuation page and to also get a quote from Carvana to see what they would pay to buy the car right now. If the Carvana quote is close to what you are paying for the vehicle, then it’s likely a pretty fair deal.
Get a pre-purchase inspection
In today’s market, with “rougher” used cars for sale it is critically important that you get a pre-purchase inspection done on the vehicle you are thinking of purchasing. We have heard too many horror stories of people buying used cars “as-is” and then getting stuck with a piece of junk. Avoid that, and get a PPI!
Consider an extended warranty from CarEdge
Last but not least, consider getting an extended warranty on your used vehicle. CarEdge partnered with AUL Corporation to sell extended warranties with a flat markup, transparent pricing, and free consultations with an Auto Advocate. If we can help you protect your use car, we want to. More on that here: https://caredge.com/extended-warranty/ and request a free quote here: https://app.CarEdgemember.com/service-contract
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