Seasonality plays a big role in the auto market. New car shoppers are familiar with the windows of opportunity for savings: year-end car sales, Memorial Day deals, and Summer truck month, to name a few. But for used car buyers, the question remains: when is the absolute best time to buy a used car? Thankfully, there’s good news for those looking to buy a pre-owned vehicle. The optimal time to buy is right around the corner. Understanding seasonal shifts can help you save big on your next purchase.

Less Demand Equals Better Deals

The key to finding the best deals on a used car lies in identifying when demand is lowest. According to CarEdge’s Ray Shefska, the slowest period for used car sales typically runs from mid-December through the end of January. This predictable dip in demand happens for two main reasons. First, year-end promotions and zero-percent financing deals on new cars lure many would-be used car buyers into the new car market. For buyers with solid credit, it makes more sense to take advantage of these new car offers. As more drivers shop new cars, the demand for used cars softens.

Second, tax season plays a major role. Starting in late February and running through spring, millions of taxpayers receive their refund checks. With money in hand, the demand for used cars increases. With higher demand comes higher prices, and less negotiability. If you’re in the market for a used car, December and January are the best months to make your move.

What Does The Data Say?

Supporting this trend, wholesale price data from Black Book shows a consistent drop in used car prices every December—when the market isn’t skewed by unusual factors like the pandemic. As shown above, the car market shortages of 2021 were the exception to the rule. Furthermore, used car inventory typically climbs towards the end of each year as demand slows. This seasonality is clear in the graph below.

As the used car market stabilizes after years of disruption, shoppers can expect this seasonal pattern to play out in 2024 and 2025. That means the coming months are likely to offer some of the best deals in the market. With used car values falling, dealerships are more inclined to negotiate, or better yet, lower sticker prices.

👉 See this week’s used car price update

All Eyes On December

The best time to buy a used car is right around the corner. If you’re looking for a deal, December and January are your best bet. These months are your chance to score lower prices before the tax season spike. Be sure to check out CarEdge Insights for unmatched market data for every make and model. With Insights, DIY car buyers have leverage in every negotiation!