Could Now Be the Time to Purchase a Used Car?

Are you in the market for a used vehicle? Like so many in today’s economy, prospective buyers who held off on buying a used vehicle are now stepping back into the used market pool. With the state of the used car market and the ever-dropping prices, now might be a great time to get behind the wheel of that used car you’ve been eyeing.

But why exactly are the prices of used cars dropping and what does this mean for you? Today, we’re going to take a look at how the used car market is changing, how you can take advantage of it, and what the future of used car sales looks like.

Price of Used Vehicles are Dropping

The used automotive market is finally seeing some slowdown after over two years of unprecedented growth. According to the latest Consumer Price Index, used vehicles have dropped a bit for the fifth month in a row. Today, used vehicles are about 3.3% lower than they were this time last year.

With that being said, it’s important to note that the price of used vehicles is still relatively high. Lingering issues following the pandemic, supply chain issues, and parts and accessory shortages have pushed consumers into the used car space in record numbers. As these consumers start to dwindle back into the new car space, used car prices are expected to continue leveling off.

What Does Dropping Used Car Prices Mean for Consumers?

As the auto market continues to stabilize, consumers should expect to find replenishing used car inventory at their used car dealership, allowing them the advantage of choice. Largely fueled by increasing interest rates, inflation, and more drivers selling their used vehicles due to their rise in value, prospective consumers should expect a much easier time getting behind the wheel of a used car at a price they can afford.

Analysts agree that over the next couple of months, and well into the new year, these used car prices should continue to drop. However, this downtick will likely be slow and steady as the economy regains its footing after a tumultuous couple of years.

Why Buy Used Vehicles

Buying a used vehicle can be a great financial decision for so many reasons. For starters, when you buy used, you’ll significantly save on the initial purchase because of depreciation. On average, new vehicles depreciate 20% of their value in the first year, and an overwhelming 40% of their value in their first five years.

In addition to this lower initial purchase price, you can get more bang for your buck by shopping use models. Many used models come equipped with add-on packages and features that would typically cost quite a bit had you purchased them new.

How to Plan For Your Next Used Vehicle Purchase

Despite the price of used vehicles dropping, purchasing a used vehicle is still a substantial financial transaction. For this reason, it’s important to plan accordingly so that you feel confident in your used vehicle purchase.

One of the best ways to plan accordingly is by saving a hefty down payment. With interest rates being the highest they’ve been in nearly two decades, saving up a sizable down payment will help stifle that financial burden. Plus, this will also give you additional leverage when you’re negotiating rates with your local lender.

Bottom Line

As the cost of used vehicles continues to tick down, now might be the best time to purchase that used car you’ve been eyeing. Visit your local used car dealership to learn more about getting behind the wheel of a great pre-owned car, truck, or SUV.