If you're looking to purchase a used car or truck, you may have noticed that the prices have been a bit higher than you may have expected. Maybe the salesman in the used car lot isn't willing to dicker as much as you may have expected. According to USA Today, the reason for this phenomenon is that pre-owned vehicle prices are at a 16-year high.

The national paper claims that the average transaction price for a used vehicle is $11,660; up 30 percent since 2008. If that total still seems palatable, consider that four-year-old Honda Accord sedans are selling for $16,175, or about $373 per month with the typical four-year loan and five percent interest. While it's not the same as buying, USA Today notes that a brand-new Accord can lease for about $250 plus taxes, title and plates.

And while we're on the subject of leasing, the U.S. recession and the sharp decrease in leasing has helped cut down on the used vehicles available, further depleting stock while demand remains strong. The price hikes are also being felt at the auction houses, where prices have soared to levels not seen in over a decade. Owners are keeping their vehicles longer as well, as the typical vehicle is now 10.6 year old, up from 9.8 years in 2007.

But while the used vehicle market is strong, many feel that the trend can't last forever. Car buyers are leasing more now. 21 percent of all vehicles moved off of new car lots are being leased – up from 11 percent in 2009. That means more vehicles will become available once those leases run their course. Credit has loosened a bit as well, so potential new car buyers with less-than-perfect credit are now more likely to find themselves in a new vehicle.


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  • 14 Comments
      1guyin10
      • 3 Years Ago
      CfC did scrap a lot of useful cars, but those were older, high mileage cars. It wasn't that much of an impact on the market (200,000 cars verses a market of several million). There are several things that have driven the current situation - greatly reduced leasing over the past few years, the end of garaunteed buy-backs for the rental companies and economic pressures which cause people to keep cars longer. The first owner is driving a car 8 years or more. That means he won't trade it in until about 125,000 miles (good luck finding a used private owner car with less than 100K on the clock). Leasing and rental buy backs used to be the major sources for low mileage used cars. Leasing hasn't been happening much the last few years so their are few lease returns on the market. Rental companies now have to keep their cars in service longer so you don't see those rolling through like clockwork as they once did. The used car market is going to be tight for a while yet. There are other factors at play though. When a used Pontiac G6 with 75,000 miles starts hitting $14,000 (just about there now) people will do the math and realize that a new Nissan Versa is a bit less than that and for a a little more they can get an Elantra, Cruze or Focus. That would explain why Nissan is maxed out on production of the Versa and Sentra, Hyundai is selling every Elantra they can make (the waiting line is a month long), Chevy sold 25,000 of the Cruze last month and Ford dealers are selling the Focus before it ever makes it off the truck. Would you spend $275 a month for a used car when you can go across the street and drive a new one home for the same thing?
      muchdrama
      • 3 Years Ago
      I'm still driving my 2000 Focus SE--oh, please, baby...keep running.
      RobbieAG
      • 3 Years Ago
      I think the biggest factor in why there are fewer used cars available is that they've been selling and producing much fewer cars since the "carpocolypse". It went from around 17 million in 2007 to around 10 million in 2009 and 2010. People keeping their cars longer and "Cash for Clunkers" are factors too.
      • 3 Years Ago
      [blocked]
        TelegramSam
        • 3 Years Ago
        Number of vouchers for Cash For Clunkers: 690,114 Number of Used Cars sold in a year (2005): 44,000,000 So, if you assume that all of those clunkers would end of up on used car lots (not the case), you would then have taken a 1.5% bite out of the used car market. The report claims a 30% increase in used car costs. Your hypothesis does not pass, even the most rudimentary of litmus tests. Sources: http://green.autoblog.com/2009/08/26/cash-for-clunkers-final-numbers-690-000-vehicles-sold-2-8-bil/ http://en.wikipedia.org/wiki/Passenger_vehicles_in_the_United_States#Total_number_of_vehicles
      Mike K
      • 3 Years Ago
      I picked up a 6500$ truck from a dealer in January for 4K incl. tax tags and title.
      Keldog
      • 3 Years Ago
      We recently bought a new Honda Odyssey for my wife (yes, I know.. a minivan), and the dealership gave us an outstanding price on the 2008 CR-V we traded in. There's only one reason why.. they are turning it around and selling it at a premium.
        muchdrama
        • 3 Years Ago
        @Keldog
        Hey, whatever works--and don't be embarrassed that you got a minivan...it's the most practical thing on the road.
      Nick Allain
      • 3 Years Ago
      I bought a used car 16 months ago. I was amazed to find similar cars selling for only $800 less than I paid for it (even factoring in +26k/mi). If there were a few more dealer incentives on the table, I'd be very tempted to trade up.
      Samurai Jack
      • 3 Years Ago
      That must be why I keep getting annoying letters from local dealers offering to buy my car. Seriously, it's at least once a week. They'll lay off for a while and then a month later the cycle starts again. Also, consider that reduced output from Japan will keep the price of certain used vehicles high. New metal just isn't available in the same quantity.
      gcarlson007
      • 3 Years Ago
      Quaker State Motor Oil has a advertizing campaign where as they will pay anybody the "Blue Book" value of their car once it arrives at 300,000 miles. I don't know about any of you, but, I don't think there is a Blue Book value on a car with 300,000 miles on it! Who would buy it?
      JacksonJeep
      • 3 Years Ago
      I'm still driving my 1996 Jeep Cherokee with over 145,000 miles on him. I plan on keeping him until he absolutely can't run anymore. Car payments are for the birds!
      Brummie
      • 3 Years Ago
      There is a healthy supply of low mileage good secondhand used cars here in the UK despite the last years Scrappage Scheme( sounds like US cash for clunkers scheme). There are some serious bargains especially amongst the premium brands but also amongst the run of the mill stuff like Mondeos or Vectras. I think its a buyers market at the moment, especially with big engined petrol cars.
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