Those wanting to save some money by purchasing a used car may be in for sticker shock. The used vehicle market is seeing an “unseasonal sharp uptick due to unique market conditions” because of the coronavirus pandemic.
This also means those with a used car sitting around could get top dollar for a trade-in or sale.
Edmunds, which has been tracking automotive trends since the 60s, says the average used car listing price was $708 more in July than in June. Large trucks had the biggest one-month jump, with listing prices $2,301 more in July than in June.
Meanwhile, trade-ins are, on average, seeing 16.4 percent more value in July compared to June. And those used vehicles are not sticking around on the lots for long. In June, it was taking an average of 44 days to turn around a used car, and in July, it was down to 38 days. This is the steepest one-month decline in Edmundshistory of keeping records.
"It's a seller's market right now. Although used vehicles continue to offer significant discounts compared to new, used-car shoppers will find themselves in the unusual position where they might not have as much negotiation power because demand is so high and dealers will be less inclined to be flexible," said Ivan Drury, Edmunds' senior manager of insights in a release from the company.
"If you're in the market for a used car, what you see in terms of pricing is likely what you're going to get, so do your research and be prepared to act quickly if you have your heart set on a vehicle."
The reason behind the sharp increase in demand for used vehicles is for a variety of pandemic-related causes, says Drury.
Consumers are being more cost-conscious right now as unemployment is high, interest rates and offers from dealers are favorable for car buying, and inventory has been “severely limited on the new side.”
Automakers closed their factories for several weeks earlier this year as states issued stay-at-home orders to control the coronavirus pandemic. That led to a decline in inventory for new vehicles.
Edmunds recommends buyers and sellers/traders do their homework and find out what the value of their specific vehicle is.
