Used Cars Still Expensive, But Prices Are Falling

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A sustained rise in new-car sales has boosted the supply of late-model used cars, and now ADESA Analytical Services reports the average wholesale price — what the dealer pays for a used car at auction — hit $9,550 in September, 2.1% below year-ago levels.

It's the latest bit of good news for used-car shoppers, and it caps price drops in the 4% range all summer, ADESA said. September's drop represents less relief, but prices are still falling. Large cars, vans and full-size SUVs bucked the trend with price increases in September, but small and midsize cars saw modest drops. Midsize and large crossovers (down 5.1%), luxury cars (down 5.9%) and midsize SUVs (down 11.2%) saw the largest drops.

That's not to say used-car prices are back to pre-recession levels, or will be anytime soon. In September, auction facilitator Manheim's Used Vehicle Value Index remained a few points below its 2011 highs, but it still outpaces any level before April 2010. And in August, CNW Marketing Research said the average used car sold for $11,138 at a franchised dealership (e.g., Bob's Honda) and $8,936 at an independent dealer (e.g., Bob's Used Cars). That's still $668 and $438, respectively, over August 2009 levels.

Lest you think the pricing relief means lower trade-in values, the Detroit News reports that shoppers are trading in more cars, but that hasn't affected trade-in values much yet, leaving a "gray area" where shoppers can capitalize.

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By Kelsey Mays | October 11, 2012 | Comments (5)

Comments 

I could prove that used cars aren't expensive. The trend is new cars are getting cheaper and cheaper or at least, for the regular American family they've become easier to get as well as the used ones.

The supply of used cars is at an all time low but new car sales are at near record highs. That means more used car inventory very soon which will drive down the prices and enable you to get a great used car for a great price.

Des Alba

Used car prices have never been this high before and there still remains a very large demographic that goes unserved.

Not everyone can afford to buy new, and not everyone can afford to buy expensive 3-5 year old used cars.

Private sales of one-owner used cars is also up as a result, as are more used cars being passed down from parents to children.

It used to be that many people who had graduating kids from high school or college would buy them a new car to get them started in their new life.

The current economy and insecure job market has put an end to that.

Used cars will remain high even though many are not worth it.

What is expected to see a rise in sales is the segment of so-called "disposable" new cars, like the econoboxes offered by Kia, Hyundai, Scion and Toyota.

The best thing that could happen to positively affect the used car market would be for cheap Chinese-made cars to flood this market, much like cheap Japanese cars did during the 1960s and 1970s.

The price of used cars is expected to decrease in upcoming time. The main reason behind this is the sudden increase in new car models which are far away from the reach of common man. Therefore those people who want to buy their own car but waiting to increase their savings to buy the car of their budget.

In the recent year of 2013 the used cars prices have experienced some ups and down as the market faced so many issues. But the latest news is that the Honda Amaze 2013 has captured the sub-continent market because of fuel efficiency and affordable price. Although the used cars ratio is very high in subcontinent yet Honda Amaze certainly moved the used cars buyer to the new car market.

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