Whether you’re in the market to buy, trade, or sell, you likely still have some trepidation. After all, the market changes constantly, and if you want to take advantage of a good car market, you need to think fast and act even faster.
This is especially true when it comes to used cars. There is always a market for these vehicles, but the trick is all in the timing. CarGuard Administration takes a closer look at the current market to help you make an informed decision about buying, selling, and trading.
What the Market Looks Like
In April this year, used car sale prices increased by almost 4% but were later reduced by an average of $60 in May. On the other hand, new car prices increased by over $470 in May compared to the month before.
Certain factors affect market behavior. In the last 12 months, vehicles traded at higher price tags with low inventory. This market change affects buyers’ behavior, causing them to defer their purchases or place orders on future stock.
With new vehicles, the shortage of microchips has slowed the production of new cars. On the other hand, car parts have been severely affected by lockdowns and the Ukraine conflict. The decline in the production of new cars has also increased the sales of used car units, driving the prices up.
As if that were not enough, gas prices have also spiked, causing many car owners to reconsider buying and using their cars. For individuals looking to buy, fuel efficiency has become the most desired feature, especially in recent years.
Unfortunately, there is a shortage of the very models that are designed to be fuel-efficient, including small cars, compact vehicles, and hybrids.
According to industry analysts, things will likely ease up before the year ends so production can pick up speed. Unfortunately, car prices will still be challenging to predict due to global factors, such as the pandemic and conflicts that affect the supply chain.
Used Car Prices
Industry analysts believe there will be a decline in the prices of used cars in the middle of the year. Although there was a sharp increase in spring, they predict that it will not be replicated in the future.
The market may be a little short for individuals looking to purchase a vehicle on a budget. Less expensive cars have been snatched up by buyers who could not get their hands on new cars. This lack of used car inventory may just be a good opportunity if you intend to sell.
The current behavior of Americans is also driving car prices and new car production. On average, Americans drive cars that are at least ten years old.
Due to the 2008 recession, there was a decline in the production of new cars. Furthermore, new cars – particularly high-performance, tech-rich models – are built to last longer. This means that they will likely be kept longer by their owners, and if they become available on the used-car market, they will likely be older and have higher mileage.
If you are planning to buy a used vehicle, you likely will find older cars with higher mileage in the market. You can expect to purchase cars right now from $15,000 to $30,000. Used cars below $15,000 are still hard to come by.
Should You Choose to Trade?
In general, trading a car will get you a lower price than selling it on your own. Dealerships have to earn a profit and factor in certain things such as reconditioning for trade-ins. Knowing what to expect will help you set realistic expectations and decide on the price.
That said, you’ll be glad to know that trading a used car in the current market will allow you to purchase a newer model.
Of course, you should make sure to do your research and shop for trade-in deals in your area. Different traders have different offers, and some may pay lower than others. You must look around for the best deal you can find.
CarGuard advises car owners and buyers to be patient. Timing is an excellent thing to have on your side, but knowing what is available will help ensure that you can obtain or sell a car at a reasonable price.
In most cases, you likely can expect to be shopping around for a few weeks and talking to several dealerships before you will settle on a final purchase. Get in touch with dealerships early on to know what makes and models are available. It is also likely that not all the best deals are in your area, so be prepared to extend your search.
Ready to Take the Plunge?
Buying a new or used car represents a good-sized investment for many people, which is why you must protect your asset.
With CarGuard Administration’s vehicle protection plans, you can ensure that your car has the correct type of protection when you need it most. CarGuard offers the best liability limits in the industry, so you can expect coverage of a minimum of $12,500 at the time of repair – even if your vehicle value is lower.
Car owners can also expect extended coverage for Gold Plus and Platinum Plans. CarGuard has become the trusted provider of vehicle protection in the industry, thanks to the quality of its innovative vehicle protection plans and reliable customer service.
Customers can also depend on protected contracts since CarGuard is a fully insured company with a Contractual Liability Insurance Policy. This means that customers and their cars are protected and cared for whatever happens. What better way to have peace of mind while driving your new car?