If you’re looking to buy a new or used car, you might have noticed that vehicle prices have increased quite a bit this year. Many factors came into play recently to make buying even a used car difficult for the average consumer.

So the question is: why are used car prices increasing, and which cars are seeing the most value increases?

What Is Increasing the Value of Used Cars?

The two main reasons for the increased price of used cars are gas prices and a shortage of microchips.

Microchip Shortages: Supply and Demand

The shortage of microchips available to car manufacturers means fewer new cars are being made and sold. But demand for vehicles hasn’t decreased in the slightest. This means that used cars are getting more popular and necessary in the automotive market.

This increased demand for used cars, while their supply remains limited due to people holding onto their current vehicles more, has led to used cars becoming more valuable. Now they’re being sold for thousands more than they were this time last year.

Gas Prices and Hybrid Vehicles

Gas prices have shot up since Russia invaded Ukraine in early 2022. For many, this has prompted a switch to hybrid or all-electric vehicles. This has caused some used cars that are hybrids or have better gas mileage to be in greater demand.

Hybrid and electric vehicles, even used ones, have always been expensive. Now that they’ve risen in popularity due to skyrocketing gas prices, they’ve grown in value even more.

Which Used Cars are Going Up in Value?

While prices for used cars have gone up across the board this year, some vehicles have seen dramatic price increases from their original new selling price in 2020 to their used sale price now. Here are a few of them:

The cost of a used Toyota RAV4 Hybrid LE is roughly $38,000, more than $10,000 more than it sold new last year.

The Kia Telluride’s price has increased by $6,000, from $35,000 new to over $41,000 used.

Kia Rios are also jumping from $16,000 new to over $20,000 used, creating an over $4,000 increase in price.

Toyota Tacomas have increased in price by over $5,000, from $36,000 sold new to just under $42,000 when sold used.

There’s a price difference of just over $3,000 for the Honda Civic – sold new at $20,000, it now goes used for over $23,000.

Experts say that because of increases in prices for used cars, now is the best time to sell or trade in your old vehicle. That’s great for anyone wanting to turn a profit on an old car they’re no longer using, but not so great for anyone looking to buy a new or used car anytime soon.

Keep an eye on the automotive market in the next few months to find out if used car prices will drop or keep climbing.