Used Car Market Is Going Wild—Prices Are Soaring Again!

Used Car Market Is Going Wild—Prices Are Soaring Again!

Hold on to your keys because the used car market is out of control right now. Cars are actually appreciating in value again, just like they did a couple of years ago. For example, a 2020 Mini Clubman went up $2,400 in just six weeks—that’s almost a 15% increase!

So what’s driving this madness? Here’s the breakdown:

Used car sales are booming. March just saw the highest number of used cars sold in the past four years.

Supply is at an all-time low. There are only 39 days’ worth of used cars available—the lowest we’ve seen since the pandemic hit.

Affordable cars (especially those under $15,000) are in crazy demand. There’s only a 28-day supply for these, which is way below last year and the industry average.

New car prices are sky-high. The average new car price is now over $50,000, making used cars an even more attractive option.

Cars are older and less quality. The average age of a used car being sold has risen from 5.3 years to 6.7 years. That means fewer quality options are available, pushing up prices even more.

But wait, it gets even crazier: Carvana and other sellers are jacking up prices too! A Honda Accord went up $1,000 in just one month, and a Subaru Outback increased by $800 in just one week.

And if you think that’s wild, banks are getting super lenient with auto loans. They’re offering up to 160% loan-to-value ratios, meaning they’re lending more than the car is even worth. More people (including those with bad credit) are getting approved, but we’ve seen this before—and we all know what happens next: auto loan delinquencies and repossessions.

So what does this mean for you?

If you're buying a used car, maybe consider a new one instead.

If you’re selling a used car, you have the upper hand. Dealers are desperate for quality vehicles, so don’t settle for the first offer.

Do your research and get the best deal for your ride! This market is crazy, but it’s your opportunity.