Where is the used car price going?

[53anddone]

The average interest rate for new cars is 7%. This has to have an impact on demand eventually.

I know the folks on this site are not normally borrowers, but the average joe in the US is.

 

[Pointby2]

My Ford Focus RS just turned seven years old today. Sticker on it was $39,560. I see a similar cars with similar miles listed on Autotrader for $39,751 (good price), $45,000 and $35,899.



Car prices are still crazy.

 

[catii]

Hmm. Hadn't considered the UAW strike.

I have a 2011 Honda CR-Z hybrid, very-low mileage (15K) because I've had it up on blocks since the pandemic. (No, not cause & effect > other health problems.) The EX package, 6-speed stick-shift, all the bells & whistles. I bought it new, & paid cash. It's in excellent condition, other than some paint fading, from the tropical sunlight, even with a car cover.

I thought about selling it, because DW & I have a big family sedan & a pickup truck, & they handle all of our needs. I was checking its value on KBB.com, & noticed that they have a free service to sell your car. I filled it out, & had 5 offers within 24 hours! Even better, all were for at least twice what KBB calculated the CR-Z is worth! I eliminated two that are out-of-state, & contacted the other three. Interestingly, the highest offer was from our Mercedes dealer, so I made an appointment to bring the car in. I had to postpone that first appointment, but they contacted me, with an even-higher offer (+$2K). I was about to set up another appointment, when one of the other bidders sent me an offer even higher than that.

I know that there aren't many used cars available locally, on Oahu, & am now wondering whether I should hold off bringing the CR-Z to any of the bidders. The offers are already up to 75% of what I paid for it, back in 2011.

 

[ncbill]

The average interest rate for new cars is 7%. This has to have an impact on demand eventually.

I know the folks on this site are not normally borrowers, but the average joe in the US is.

There are often finance specials through the dealer.

Kid just got 3.9% (4 years max term) on a new hybrid.

The non-hybrid version is eligible for 2.9% but only 3 years max term.

 

[JoeWras]

If you trust what CarDealershipGuy is saying, it isn't so much the 7% interest that's going to affect demand, it is the credit squeeze this creates as banks raise their credit requirements.

For example, he posted a notice from a big NE based credit union that is upping credit score requirements slightly for the "B" and "C" rated clients.

He also posted that the top 20% savers/earners still have cash to blow. So they can afford the expensive rigs.

My hope is this puts pressure on the low end. I don't care about the $50k+ market, they can do what they want. I'd like to see the sub $35k market start to come down. That's just me being focused on me, because we'll be looking in that market.

I was in the sub $10k market earlier this year and it is crazy. If anything, it hasn't gotten better. My vehicle resale value is steady despite 6 more months and 5k more miles.

 

[Bruno]

Not sure i would ever buy a used vehicle anymore. They can roll back the odometer faster than you can check the oil on most vehicles.

 

[REWahoo]

They can roll back the odometer faster than you can check the oil on most vehicles.

You should be able to detect this with a CarFax report.

 

[JoeWras]

You should be able to detect this with a CarFax report.

I'm 4th owner, which is a bit scary, but the Carfax showed the previous 3 all did oil changes every 4k to 8k miles. Religiously. Hard to fake an odometer report on that.

Now I'm going to do my own changes and the next owner will wonder if I ever changed the oil.

My state inspections will still land on the Carfax report though.

 

[jollystomper]

I just lost a friend (age 87) who I've known for over 50 years. When he was about 75, he bought a new truck - all the bells and whistles, etc. He said "This will be my last new truck, so I wanted it to be special."

Well, 3 years or so later. He traded it in. "This will be my last new truck..."

When he turned 82 I think it was, he traded THAT truck in for his "...last new truck..." He was "celebrating" because he had just gotten a new J*B and his cancer was in remission! Also his son-in-law had hired him to deliver auto parts for the store, so he was "flush."

Well that DID turn out to be his last new truck and he had to move into assisted living with his DW at age 86 - had to give up the "last new truck."

All in all, a life well lived and he had strategic BTDs along the way.

BY ALL MEANS - get your last new truck - er, car! Heh, heh, just don't plan on it being your forever "last." Things change and we all change. "Last trucks (or cars)" included.

ENJOY!

Thanks. O believe I will be okay. I tend to look at cars as basic, functional transportation, and bells and whistles do not impress me. I would rather have a "no-frills" car that only requires routine maintenance for 10+ years than a "decked-out" fancy model with all kinds of features that ends in the shop every month or so. The only reason DW and I have replaced cars has been due to major cost repairs (> the value of the car) or totaled in accidents. Of course, 2 of my brothers have the "something new/different to drive every 2-3 years" mindset, so it does not run in the family .

My current car is a 2011 Camry LE (bought used), some spots could use painting, no fancy features inside (other than ones I've added like USB ports and a dash cam), but it has been solid for 10 years now. I still like its styling over the newer Camry models

My BTD mindset is considering a new car that would last at least 10 years, with preference for an SUV, and willing to dip my toes into the hybrid pool for better mileage. But. I am patient, so we will see how it turns out .

 

[check6]

My current car is a 2011 Camry LE (bought used), some spots could use painting, no fancy features inside (other than ones I've added like USB ports and a dash cam), but it has been solid for 10 years now. I srill like its styling over the newer Camry models.

I am with you re my '05 Camry with a cracked windshield that I inherited and is still going strong. Wife is too embarrassed to ride in it. I keep threatening to buy a newer one and she threatens back with div if I do.

 

[JoeWras]

I am with you re my '05 Camry with a cracked windshield that I inherited and is still going strong. Wife is too embarrassed to ride in it. I keep threatening to buy a newer one and she threatens back with div if I do.

Finally decided to replace the windshields on our 2009 and 2010 cars. Both were cracked for at least the last 5 years. LOL, why did we wait so long? We used the budget company (Auto Glass Now) and they did a fine job for a great price. We waited so long we were in danger of replacing them right before they go to auto graveyard.

BTW, my crack would occasionally cause a really irritating and dangerous reflection on sunny days. The sun would light up the crack and reflect directly into my line of sight.

 

[Car-Guy]

All's I can say, if you can afford fancy new or late model used cars (luxury and/or performance), get them and enjoy them while you can. Read into that what you like!

 

[Koolau]

Finally decided to replace the windshields on our 2009 and 2010 cars. Both were cracked for at least the last 5 years. LOL, why did we wait so long? We used the budget company (Auto Glass Now) and they did a fine job for a great price. We waited so long we were in danger of replacing them right before they go to auto graveyard.

BTW, my crack would occasionally cause a really irritating and dangerous reflection on sunny days. The sun would light up the crack and reflect directly into my line of sight.

Apparently, no state inspection Our inspections would likely fail a cracked WS.

 

[Koolau]

All's I can say, if you can afford fancy new or late model used cars (luxury and/or performance), get them and enjoy them while you can. Read into that what you like!

Heh, heh, yeah, none of us gets out of here alive! Pleasant thought.

 

[Koolau]

I do have an indelicate question to ask. For those buying a "new" used car (or, even a new car) are you desperate to buy because you need the transportation? I ask because if pure transportation is not at issue, would it not make sense to wait until car prices shake out a bit?

I believe that chip issues are still affecting new car availability which then puts pressure on (especially) newer used cars. Unless it's critical to buy "another" car, I'd consider giving it 6 months or maybe even a year to watch prices (and maybe even interest rates) to readjust.

If you're actually "short" a car, that's a different story, I guess.

Last "new" used car I bought, my "back-up" (aka MY car) had died (transmission shot.) I waited several months and shopped until I found a really good deal. Now, heh, heh, I don't think there are many good deals. I understand there is no guarantee this will all shake out in 6 to 12 months, but it seems more likely than not.

I suppose, it's my reluctance to "buy into" a seller's market. I just pretty much refuse to do that if there is an option. I'm kinda stuck right now - we now only have one car - and I would have to buy pretty quickly IF my current car died. But otherwise, I can live with my "old" car a while longer.

Just the musings of one who hates buying in a seller's market so YMMV.

 

[Car-Guy]

Unless it's critical to buy "another" car, I'd consider giving it 6 months or maybe even a year to watch prices (and maybe even interest rates) to readjust.

That's the main reason I'm waiting. Even with the inflation over the past ~year, the prices of the vehicle I'm interested in are just crazy high. If they don't drop to a more reasonable level in the next ~6 months, I'll probably still buy one, but I hate getting ripped off. Why? Well, I only get to go this way once!

 

[Chuckanut]

The Ford Lightning Flash is supposedly starting at $70,000.

That’s a lot of chips.

 

[Car-Guy]

The TRX model I'm looking for is in the 110+ range... Should be in the mid to upper 80's, IMO.

 

[JoeWras]

Apparently, no state inspection Our inspections would likely fail a cracked WS.

We have state inspections. Even if the crack extends end to end like ours did, but does not impact your line of site, you get a pass. I know you hear a mantra here and other places that "the windshield is structural." OK, but a crack doesn't necessarily materially impact that. Take out the windshield and then there's an impact. Mostly, that "45% of structural rigidity" is quoted ad nauseam by glass companies and spin the quote in a way to make you think a crack breaks everything and the windshield is now useless in an accident. Mechanical engineers may have a different opinion. Apparently my state does too.

I do have an indelicate question to ask. For those buying a "new" used car (or, even a new car) are you desperate to buy because you need the transportation? I ask because if pure transportation is not at issue, would it not make sense to wait until car prices shake out a bit?

No, we are not desperate. I was desperate for a work vehicle which is why we bought the old used minivan. So now we have an extra car. This will allow us to keep going with the three old vehicles. If one goes down, we're still OK.

The fly in the ointment on that idea is that DW's friends don't like or won't drive with her anymore. They say the car is too old (2009). One of those friends is very materialistic. I think the others just don't like the feel of the seats. I know I hate them.

And maybe fixing the windshield will help. I admit we both got used to them. I told DW I remember getting into other people's cars with cracked windshields and wondering what was wrong with those people. Then we became one of them. Amazing what you can get used to.

This is why we are casually looking for DW. We were supposed to start looking now, but that has been moved to winter. I'm going to guess we won't bother until next year at this time.

 

[CaptTom]

I do have an indelicate question to ask. For those buying a "new" used car (or, even a new car) are you desperate to buy because you need the transportation? I ask because if pure transportation is not at issue, would it not make sense to wait until car prices shake out a bit?

Exactly why I keep visiting this thread, looking for a sign that the winds might change.

I love my old truck. I just spent some money on it to keep it going a couple more years. But every time I drive by that auto auction place I mentioned, I make note of how many trucks are in the lot. As that number goes up, I get more interested in looking for a used by late-model replacement. But I also look at macroeconomic trends. A nice recession this year or next would probably increase my buying power in the used truck market.

 

[freedomatlast]

The fly in the ointment on that idea is that DW's friends don't like or won't drive with her anymore. They say the car is too old (2009). One of those friends is very materialistic.

I would never say to anyone, friend or not, that I wouldn't ride in their car because it's 14 years old.

On the other hand, maybe she should just hold on the the 2009 and let her friends incur the expense to drive everywhere when they go since it's beneath them to ride in a 2009.

 

[JoeWras]

Exactly why I keep visiting this thread, looking for a sign that the winds might change.

Yeah, this is a great thread to share our findings.

I'm amazed at how our old cars are not budging in value, even as we add age and years. And my tax bill feels it because my state taxes us yearly on the value. Normally this drops like a rock. It has been rising!

We were on a good roll last year and then this spring it reversed. Over summer it started dropping and now is stable. I was sitting on the market in January hoping for more drop and then sensed it was rising so bought quickly in March.

Here's one source of many to check. You can plug in new dates and different brands.

Source: https://www.cargurus.com/Cars/price-trends/

Sample:

 

[Teacher Terry]

Joe, I think your wife needs some new friends. I can’t imagine telling somebody that you won’t ride with them because their car is too old.

I belong to a senior dining group and a few people that recently joined and have a lot of money drive cars older than mine. We got talking about it and they are also Toyotas that seem to last forever and they aren’t driving nearly as much since retiring.

 

[JoeWras]

I think their complaint is safety standards.

I still find the whole thing odd too.

 

[cbo111]

The TRX model I'm looking for is in the 110+ range... Should be in the mid to upper 80's, IMO.

But for ~100K, you do get a lot of truck for ~100K. That SRT engine is nice. Who doesn't need a truck that does 0-60mph in 4.5 seconds?