Changing Used Car Price Trends Have Consumers Anxious about Sales, Trade-ins (2024)

FAQs

Why do used car prices fluctuate? ›

Prices fluctuate based on supply and demand, so you can often find deals on last year's models when new models are coming in (typically in the fall). As the calendar year ends, fewer models from the previous year will be available.

Cox is forecasting a 3% year-over-year hike in CPO sales this year, with sales projected at 2.7 million units. In the first month of 2024, however, certified sales were off to a slow start. Cox estimated in February that CPO sales for January were down 12% month-over-month and even with January 2023 figures.

New vehicle sales in the U.S. rose nearly 5% in 2024 as buyers defied high interest rates, but EV sales growth slowed. New vehicle sales in the U.S. rose nearly 5% from January through March, as buyers stayed in the market despite high interest rates.

Lower auto prices are finally giving Americans a break after years of inflationary increases. Automobile prices, which had been fueling inflation in the U.S., are starting to drop, helping to slow overall consumer price increases and giving buyers hope of getting a deal.

I'll try to keep this as simple as possible. One of the many issues is that new vehicle prices have skyrocketed which affects the used prices. People can't afford new, so they need to buy used. Demand for used cars has gone WAY up which shortens the supply.

Neiman said one of the best times to buy is at the beginning of the year. January and February are when dealers are trying to make room for newer inventory and consumers often desire to buy the next model-year vehicle.

Experts say that 2024 will be the best year to purchase a new car since 2019. As interest rates slowly drop throughout the remainder of the year, payments will become more manageable. Don't overlook manufacturer rate promotions, as they can save you thousands of dollars.

Gasoline-powered cars could soon start to disappear, but car dealers aren't going anywhere, in part because they're protected by strong franchise laws. Their business is changing fast, however, as car sales move online and electric vehicles get more popular.

Are auto sales declining? ›

From 2019 to 2023, the market averaged 15.2 million, lower by more than 12%. The reasons are clear and obvious: Notably, higher prices and higher loan rates have put a large number of shoppers on the sidelines, waiting for conditions to change.

January Comes After December

This is the top reason why January is the slowest month for car sales. It's not about the cold weather, but it all has something to do with the month before that – December. The last month of the year is the busiest, with the holiday season and many people go shopping.

There may be a limited effect on the used car market

Production of new vehicles has increased in recent months, but there's little chance that a recession will affect the used car market much. In the past, recessions tended not to lead to a substantial fall in used car prices.

The general rule of thumb is to put down at least 20% for a new car and 10% for a used car. But any size down payment can help lower your monthly payments and reduce the amount of interest you pay over the course of the loan.

Having shifted their offerings along with consumer preference in recent years, U.S. automakers have largely stopped making the kind of cheap car that is now in higher demand, with car lineups from the Big Three Detroit automakers virtually devoid of the kind of small sedan and hatchback that was once considered ...

It turns out that some times are better than others to buy a car. Even though there often are sales on vehicles throughout the year, such as around Memorial Day and Labor Day, the final few months of the year — think October to December — is the real sweet spot for buying.

Used car prices are dropping after skyrocketing during the pandemic due to lack of new car supply. Used car prices fell 7% in 2023, and 21% from December 2021 to December 2023, according to the Manheim Used Vehicle Value Index.

Year-end sales events, three-day holiday weekends, and the end of each month have traditionally been the best times to get great deals on a new car. These are the times when dealers look to clear inventory and meet sales quotas.

Prices on new cars are expected to drop in 2024 as the industry moves beyond the supply-chain issues that pushed up auto prices during the pandemic, which will gradually ease the prices on used vehicles as well. That's welcome news for car shoppers who have faced record-high prices over the past couple of years.