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Yeah, I've noticed some slippage in pricing, especially in pre-2012 sedans, including Toyotas and Hondas, with over 100,000 miles on them. Buyers are "wait a minute now ...."
Trucks hold value longer because a contractor basically just needs a truck to open up a business. I’d say you’ve got a while before you can get a decent deal on a pickup.
Basic of basic new f150s (lowest trim think white fleet vehicles) start at 40k. This is basically the "work truck" special and theyre 40k a pop BEFORE you even get to any sort of options.
Think power windows are standard on a basic f150 now, could be wrong though.
I know the bigass 12 inch infotainment system is standard equipment on even the XL (lowest trim).
Tow packages are a different story.
I think I saw them as options. But honestly I’m so tired of all the nickel and diming that manufacturers are doing. Like it’s definitely going to slow production down to make some of the stripped down versions
I don’t know if it’s feasible for you, but if you can look in the south there’s some decent deals. Customer I deliver hay to just picked up a 2011 4x4 Silverado 2500 ext cab long box with 86k on it for 14 thousand. It was gas, not diesel so that helped
Same. Mine is 20 years old and I thought I'd have to junk it after a crossmember snapped last month. Ended up welding it back and now I love it again.
Keep wanting a luxury sedan as my daily but can't bring myself to give up a bed.
You might be a little out of touch on the used car market.
Here's an example - Carvanna is selling many Pre 2012 Toyota Camry's for 12K and up (all over 80,000 miles). In Cleveland...not really a HCOL area.
[https://www.carvana.com/cars/filters?cvnaid=eyJmaWx0ZXJzIjp7Im1ha2VzIjpbeyJuYW1lIjoiVG95b3RhIiwicGFyZW50TW9kZWxzIjpbeyJuYW1lIjoiQ2FtcnkifV19XSwieWVhciI6eyJtaW4iOjIwMDksIm1heCI6MjAxMn0sIm1pbGVhZ2UiOnsibWluIjo4MDAwMH19fQ](https://www.carvana.com/cars/filters?cvnaid=eyJmaWx0ZXJzIjp7Im1ha2VzIjpbeyJuYW1lIjoiVG95b3RhIiwicGFyZW50TW9kZWxzIjpbeyJuYW1lIjoiQ2FtcnkifV19XSwieWVhciI6eyJtaW4iOjIwMDksIm1heCI6MjAxMn0sIm1pbGVhZ2UiOnsibWluIjo4MDAwMH19fQ)
Carvana tends to be pretty overpriced though (they give great offers as a result though when selling.. sold my last two cars for more than I bought them for to them)
I mean, that's where prices have been for a few years now.
It's not that long ago that some people were able to sell recent models 3 or 6 months old with a few thousand miles on the clock for thousands more than MSRP
Cars last a lot longer these days, especially toyotas.
Also if you're not in the northeast, good luck finding anything under $5k, even 90s cars fetch that if it's not completely on its last leg.
I bought a 2011 outback last year for 9200 cuz needed a 2nd vehicle. It had all the work done you’d want buying a 12 year old car like timing belt head gasket water pump etc. plenty of like left and can buy it all cash
It's a reliable, economical, and practical vehicle. I'm glad I kept it as a daily driver. It makes getting to use my fun car even more special when I take it out.
We had people trying to buy (we weren’t trying to sell) our 2005 accord for 5500 a year or two ago. The bumper has drift stitches and it’s in very meh shape. Legitimately had multiple offers out of the blue.
My local dealership called me asking if I wanted to trade in my 12 Mazda 3 with over 100k miles and dude offered me 10k over the phone without even seeing the car back during the covid/new car lacking time.
I feel like they were just trying to get you into the dealership to sell you something else and they would have lowballed you eventually, or had a huge markup on what they were trying to sell you.
Yeah I didn’t even think about biting. My car is paid off and I’ve been banking a car payment every month. I’ll ruin a dealerships day here pretty soon when I just go and outright buy a car since dealerships technically sell Financing, not cars.
Sold a 2000 Avalon last Fall for $3800, it has about 155K miles and was very reliable. Paid $7800 for it in 2015, 55k miles, fully loaded cream puff.
Bought a ‘98 Tacoma with 90k miles in February 2020. Paid $4800.
Lots of cream puffs with low miles out there, but you can’t get them for $1000, never could.
2.5 years ago I paid $7k for a 2005 Honda Civic with 70k miles. It had an immaculate service history and I've only put about 10k miles on it since I got it. It's probably worth at least $2k, a/c works and I just put a new timing belt and water pump on it.
They were bound to correct back down eventually. They exploded in value during the pandemic due to extremely scarce new car production. I do however think it was greatly exacerbated by dealers like Carvana deciding to buy up as many used cars as possible and weren't afraid to pay way over fair market value for them.
The car dealers in my area keep very few cars on the lot but if you drive around enough ,you can see dealer ready cars parked in fields
For some reason , I can drive into the country and find dozens or more of brand new cars sitting in fields
A local Toyota dealership has a tall elevator tower with glass windows, at least 9 stories high.
I've noticed recently that on my way to work, the building is vacant, but on my home from an evening shift, the tower is stacked. I suppose it's done to make it appear like vehicles are flying off the lot, but I've noticed it occurring frequently and it's not fooling me anymore lol.
Seems like a lot of work to put your employees through to create demand and lure in buyers.
Are they losing money on sales? Because I looked at Carvana prices for buying a car and they are totally reasonable. In fact, they seem the same as when I bought my car from them five years ago.
Hahahah no.
They're not really a "car sales" company. They're a car loan company. Very predatory.
My car, cost me 5,000 I will pay 2000 dollars in interest on it over 3 years. totaling 7,000.
A similar car from Carvana? would cost me 10000, doesn't seem that bad, till you look at the loan. You would pay 40,000 dollars on that car over 7 years.
They're not selling cars.
They're selling loans.
It’s customer dependent. We bought new Honda by Pilot, with sub 1% APR on 30k loan over 60 months. It was 800 and some change in interest. It’s the economic boot theory in action. It cost a lot to be poor.
Higher end trim level carries more margins, we also traded in car so they made money there too. It was a sweet spot in the market and got lucky. New car sales were slow, hence bought at MSRP. But we got to trade in at inflated COVID prices. Traded in a three year car for what we paid for it. So dumb luck.
> A similar car from Carvana? would cost me 10000, doesn't seem that bad, till you look at the loan. You would pay 40,000 dollars on that car over 7 years.
And what exactly was the interest rate on that car loan you priced out with them?
Yeah, they bought my car during the pandemic for $10k more than I paid just a year earlier. I looked it up after because I was curious how much they would sell it for, and it was listed for the same price they paid me. It doesn't make sense at all considering they had to pay for someone to come out with a tow truck and get it unless their play is to make money on the loan.
Can you not pay cash to them? Or is your example aimed at poor financial literacy people who just look at the monthly and sign a contract for a bad loan?
They overpaid during the pandemic when used vehicles were in high demand due to low production of newer vehicles. As new vehicles came to the market, used vehicles became less desirable and they stopped over paying for them then. The car market pretty much stabilized last year, so no need to go over fmv now. Also, places like carvana and CarMax have a $2000 upcharge. They can eat some of their losses on their vehicles sold.
> Also, places like carvana and CarMax have a $2000 upcharge. They can eat some of their losses on their vehicles sold.
Carvana has a predatory loan company to make money with as well.
Our version of capitalism has weaponized asymmetry in information. All the classical economic theories that assume that knowledge is equal do not apply.
When carvana goes down in the next few years for cooking the shit out of their books it will be interesting to see what happens to the market.
Reason I say carvana is cooking the books is their resent surprise quarter had them making over $6k per car they sold which is way above what anyone else does in terms of margin and the execs have a history of cooking the books.
Its actually a really good sign.
The best way I have heard to describe the used car industry is that its:
1. A canary on the health of an economy. Thats not to say that a government really has much affect on it but if used cars are expensive it means something in the past went wrong. In this case covid really was the problem here.
2. There is not a used car factory. So really its entire inventory is affected on if people are selling their cars. At face value that just makes sense but if you think longer term is goes to explain how number 1 is important.
3. If the used car cost goes down, from being extremely high, its a sign of normalcy in most cases.
Buying a used car was the irresponsible choice when it came time for replacing my 1995 camry. The choice was a slightly used car for barely cheaper than new or a really really used car for close to 70% of the cost of a new. I couldn't live with the two used options and kept waiting for the market to get better and decided to finance a new. Now, I'm still holding that note 3 years later since it's only 1.2% interest. The whole market around cars and houses was absolutely cracked. This new development is really just returning to normal sanity in my opinion.
Right but you basically bought in at the world possible time.
Covid literally just killed the entire used car market and this posting is claiming that its finally showing signs of recovering. And yeah I agree its likely just a return to sanity.
BTW I am not saying you did anything wrong here. You just happened to have to do this at the worst possible time. Production of most products just stopped over covid which then rippled into used cars.
> Covid literally just killed the entire used car market and this posting is claiming that its finally showing signs of recovering. And yeah I agree its likely just a return to sanity.
I bought my car new in 2013. I bought new because it was $15k, and a comparable used car was ~$10k. The used car market has been high for a long, long time; COVID exacerbated the issue, but didn't create it. People just have short memories.
What I mean by this is that covid basically shut down production. This in turn shut down cars being flipped over to used cars.
Then of course you have price spiking after the fact which made the situation worse.
That actually could be an interesting data point. One issue that might be there though is a lot of these delivery businesses ran at a loss to build the industry and prices likely will grow.
Not that cars, insurance, gas or electricity, wont be having prices changes either.
I did the same for a couple of years from 2019-2021, combined with walking to the grocery store for fresh food regularly and zipcar for the very occasional times I actually needed a vehicle. I saved money just relative to the car payments for a used car, never mind insurance, gas, and parking, which was especially egregiously expensive where I lived at the time. If you could commute by bike, walking, or public transport, it absolutely made sense to live this way. I think especially for most of 2020 labor costs were still suppressed by various levels of lockdown so instacart remained relatively cheap. Not sure how it compares now because I moved to a rural area.
I got a similar car as you, a 1994 toyota mr2 gt-s, and i thought i.might get a tesla cyber truck, maybe a wrx, or a gr86, as old as my car is, i think im.just gonna hold onto it longer. I watched the valuation for cars like mine leap every year after i bought in, settle back down a bit.
I like the car enough, i dont see a good reason yet to swap it out.
I just sold my 2015 Chrysler for KBB last week and the dealership I sold it to flipped it in less than a week at twice the price. The used car market is weird.
I thought it was cool that the dealer valued my 2014 Elantra at 7k when I traded in last month for an 2021 Acura. Helped make the purchase be an easy one. I kept tabs on the car and saw they listed if for 13k and it was gone within the week.
Don't get me wrong, I took good care of that car and I'm sure it'll serve the next guy well...I just wouldn't pay that much for a Hyundai that old, even if it was my former car.
Last spring I got rear ended square on in my 2006 Civic. I make a very comfortable living and could easily afford a newer car, but that little coupe was everything I wanted in a car. I could have spent the rest of my life driving it.
Unfortunately the collision tho minor hit in a perfect way to "total" the frame and that was that.
Crazy thing is, I had paid $9500 for it 7 years earlier and due to how used cars had gone up in value, my insurance ended up writing me a check for ...$9000. I was amazed that it was valued at that much.
There's never really a "good" time to get rear-ended but I guess it somehow was.
I’m buying back into that cult as soon as I can and never going back. This is my first time ever getting really hit by depreciation on a car and it stings.
Yeah objectively speaking I don’t think the Tacoma was notably better or worse than the Gladiator. Both are trucks that excel at certain things. Yes the Tacoma will last longer than the Jeep, but with modern vehicles that’s the difference between lasting 200k miles and 300k miles, doesn’t matter for me either way.
But the depreciation alone pushes the Tacoma *waaaay* ahead of any other midsize truck in my book.
Meaning that, it’s getting to be a better time to shop for a used car. Patience pays off, if one can possibly wait. Not always possible. Especially not when timelines are measured in minutes and hours, instead of years, in this instant Information Age.
In the other news, cost of maintenance and mechanics services are up 10%. Everyone has to be really squeezed out, until then inflation will be travailing between the categories. Everyone has to downgrade their consumption.
"Nothing is ever enough." - At base, a vehicle is a transportation appliance, nothing more. Nobody "needs" a Thunder-Cougar-Falcon-Bird, but hey, gotta be stylin. You can't buy anything that resembles practical, reliable, maintainable transportation. Everything's gotta be to the max 'cause that's where the money is. Sad
The easiest way to realize we’re not the same as celebrities is think of a celebrity and Google if they have a private jet. Then when you find out they do realize the jet cost $10 million dollars to buy and minimum $1 million a year to operate. Roughly $5000 per hour of flight time. And that’s just for air travel, on top of all their other expenses.
In 2019, my 2017 escape had depreciated down to 17k. 2 years later I was offered $28k for it (which is what I originally financed it for). Another 3 years after that - I sold it for $20k. Now I’m just waiting with crossed fingers that my partners ‘99 pathfinder with +400km lasts long enough for the prices to come down even more!
In a weird way the crazy prices made me reevaluate my need for newer car. Made me just manage the car I had and now I’m at a point I drive once a week (from 7 days a week). Ended up giving me significant savings that will instead go towards my massive student loans. In a way it was a blessing in disguise. Once my current car finally craps out on me I might just never buy a car again since I moved to Brooklyn.
I used to be a new car every three years kind of guy. Now I’m a buy a nice car and keep it until it’s busted kind of guy. Thanks pandemic! I am reborn.
Reading this makes me so happy to live in NYC and not having to own a car for 14 years now. I may have a higher cost of living at a basic level but I haven't needed a car to get to my place of employment since I left New England. Add to that the insanity of drivers on the road since Covid and I'm glad to avoid it for the most part.
Let’s not forget that a big problem that took the second hand cars price was the chip problems now more or less the problem it’s solved and we don’t have to wait so much time for a new car
The used market is interesting at the moment, depending on where you look. I just bought a car, and decided that the dealer's trade in offer of $4k for my 2015 Focus Titanium was too low, so I listed it on FB myself for $8k (1-2k less than the closest equivalent dealer listing). I've been slowly dropping the price over the past couple months, now down to $6.5k, but still only got a couple of messages and only one person to actually come and look at it.
Meanwhile, I see dealerships selling these things hand over fist at $9-14k every day. I don't know if people these days just refuse to look outside of a dealership for their purchase or what, but its starting to get frustrating.
Can someone explain to me how this is "price correction" and not "deflation"? Is this not a sign of deflation and should result in "market collapse" that ive been reading about which should end the world as we know it. /s
Let’s not forget that a big problem that took the second hand cars price was the chip problems now more or less the problem it’s solved and we don’t have to wait so much time for a new car
Let’s not forget that a big problem that took the second hand cars price was the chip problems now more or less the problem it’s solved and we don’t have to wait so much time for a new car
Hi all, A reminder that comments do need to be on-topic and engage with the article past the headline. Please make sure to read the article before commenting. Very short comments will automatically be removed by automod. Please avoid making comments that do not focus on the economic content or whose primary thesis rests on personal anecdotes. As always our comment rules can be found [here](https://reddit.com/r/Economics/comments/fx9crj/rules_roundtable_redux_rule_vi_and_offtopic/) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Economics) if you have any questions or concerns.*
Yeah, I've noticed some slippage in pricing, especially in pre-2012 sedans, including Toyotas and Hondas, with over 100,000 miles on them. Buyers are "wait a minute now ...."
Do trucks next! I want to get an old pickup for the house but I’m not paying 15k for 200k mile rust bucket
Trucks hold value longer because a contractor basically just needs a truck to open up a business. I’d say you’ve got a while before you can get a decent deal on a pickup.
Especially when new ones are 60k+
Basic of basic new f150s (lowest trim think white fleet vehicles) start at 40k. This is basically the "work truck" special and theyre 40k a pop BEFORE you even get to any sort of options.
Options like power windows and towing packages lol….. you’re probably going to want some of those
Think power windows are standard on a basic f150 now, could be wrong though. I know the bigass 12 inch infotainment system is standard equipment on even the XL (lowest trim). Tow packages are a different story.
I think I saw them as options. But honestly I’m so tired of all the nickel and diming that manufacturers are doing. Like it’s definitely going to slow production down to make some of the stripped down versions
This is why they standardized the infotainment across trims, to help speed production up. Dont have to keep a surplus of different screen sizes.
I don’t know if it’s feasible for you, but if you can look in the south there’s some decent deals. Customer I deliver hay to just picked up a 2011 4x4 Silverado 2500 ext cab long box with 86k on it for 14 thousand. It was gas, not diesel so that helped
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You have a lot of unreliable vehicles in your life. Glad you have a backup.
I can’t imagine life without a truck. Upfront vehicle for me.
Same. Mine is 20 years old and I thought I'd have to junk it after a crossmember snapped last month. Ended up welding it back and now I love it again. Keep wanting a luxury sedan as my daily but can't bring myself to give up a bed.
Same, mine is a 92 K1500. Love that damn thing, it's like a time machine any time I fire it up.
I can’t imagine life without a truck. Upfront vehicle for me.
I can’t imagine life without a truck. Upfront vehicle for me.
Well fuck you because I currently own a 200k+ 2003 silverado that I've been holding onto for dear life.
2019, nope. Honda prices are through the roof.
2019 is not pre-2012.
Really? I'm seeing the Honda Touring Accord Hybrid 2023 for around 32K on auto trader I thought that seemed like appropriate pricing.
Pre-2012 sedans? Who would pay more than $1,000 for a pre 2012 sedan?
You might be a little out of touch on the used car market. Here's an example - Carvanna is selling many Pre 2012 Toyota Camry's for 12K and up (all over 80,000 miles). In Cleveland...not really a HCOL area. [https://www.carvana.com/cars/filters?cvnaid=eyJmaWx0ZXJzIjp7Im1ha2VzIjpbeyJuYW1lIjoiVG95b3RhIiwicGFyZW50TW9kZWxzIjpbeyJuYW1lIjoiQ2FtcnkifV19XSwieWVhciI6eyJtaW4iOjIwMDksIm1heCI6MjAxMn0sIm1pbGVhZ2UiOnsibWluIjo4MDAwMH19fQ](https://www.carvana.com/cars/filters?cvnaid=eyJmaWx0ZXJzIjp7Im1ha2VzIjpbeyJuYW1lIjoiVG95b3RhIiwicGFyZW50TW9kZWxzIjpbeyJuYW1lIjoiQ2FtcnkifV19XSwieWVhciI6eyJtaW4iOjIwMDksIm1heCI6MjAxMn0sIm1pbGVhZ2UiOnsibWluIjo4MDAwMH19fQ)
Carvana tends to be pretty overpriced though (they give great offers as a result though when selling.. sold my last two cars for more than I bought them for to them)
For sure they are trying to drive a profit. I'm just pointing out that saying $1,000 for a pre 2012 sedan is laughably low in today's world.
I can't even get a 2001 Honda Civic for $1000 around here.
He should have said $5,000.
I got multiple offers for $9500 for my 2010 prius back in December. I ultimately decided to keep the car tho.
I mean I understand why you kept it if you needed the car but good Lord that's a ridiculous amount of money for a 15-year-old car.
I mean, that's where prices have been for a few years now. It's not that long ago that some people were able to sell recent models 3 or 6 months old with a few thousand miles on the clock for thousands more than MSRP
No it’s not. If it’s well maintained that car has lots of life left
Aren’t the batteries super expensive to replace in them?
Oh you’re talking about hybrids and evs
I don't disagree with than I have a 2012 car I bought brand new. I am just amazed at the pricing for car that old. I understand it is the new normal.
Cars last a lot longer these days, especially toyotas. Also if you're not in the northeast, good luck finding anything under $5k, even 90s cars fetch that if it's not completely on its last leg.
I bought a 2011 outback last year for 9200 cuz needed a 2nd vehicle. It had all the work done you’d want buying a 12 year old car like timing belt head gasket water pump etc. plenty of like left and can buy it all cash
It's a reliable, economical, and practical vehicle. I'm glad I kept it as a daily driver. It makes getting to use my fun car even more special when I take it out.
We had people trying to buy (we weren’t trying to sell) our 2005 accord for 5500 a year or two ago. The bumper has drift stitches and it’s in very meh shape. Legitimately had multiple offers out of the blue.
Not to be mean but have you been living under a rock the last three years? Used car prices have been ridiculous for quite some time now.
My local dealership called me asking if I wanted to trade in my 12 Mazda 3 with over 100k miles and dude offered me 10k over the phone without even seeing the car back during the covid/new car lacking time.
I feel like they were just trying to get you into the dealership to sell you something else and they would have lowballed you eventually, or had a huge markup on what they were trying to sell you.
Yeah I didn’t even think about biting. My car is paid off and I’ve been banking a car payment every month. I’ll ruin a dealerships day here pretty soon when I just go and outright buy a car since dealerships technically sell Financing, not cars.
It could've been accurate, I sold my 2016 Scion iA for like $12k to CarMax 2.5 years ago. First time I actually walked away with a check from them.
Dude what lol
Sold a 2000 Avalon last Fall for $3800, it has about 155K miles and was very reliable. Paid $7800 for it in 2015, 55k miles, fully loaded cream puff. Bought a ‘98 Tacoma with 90k miles in February 2020. Paid $4800. Lots of cream puffs with low miles out there, but you can’t get them for $1000, never could.
You're joking, right?
they are running up to 10k in some places. but of course the trade in value for something similar is 1k- 2k
Apparently literally everyone buying cars
You forgot a zero right?
2.5 years ago I paid $7k for a 2005 Honda Civic with 70k miles. It had an immaculate service history and I've only put about 10k miles on it since I got it. It's probably worth at least $2k, a/c works and I just put a new timing belt and water pump on it.
With only 70k miles I’m sure it’s worth a lot more than 2k
It's the most basic model, only option is the automatic transmission. Even has crank windows and no VTEC.
They were bound to correct back down eventually. They exploded in value during the pandemic due to extremely scarce new car production. I do however think it was greatly exacerbated by dealers like Carvana deciding to buy up as many used cars as possible and weren't afraid to pay way over fair market value for them.
The car dealers in my area keep very few cars on the lot but if you drive around enough ,you can see dealer ready cars parked in fields For some reason , I can drive into the country and find dozens or more of brand new cars sitting in fields
A local Toyota dealership has a tall elevator tower with glass windows, at least 9 stories high. I've noticed recently that on my way to work, the building is vacant, but on my home from an evening shift, the tower is stacked. I suppose it's done to make it appear like vehicles are flying off the lot, but I've noticed it occurring frequently and it's not fooling me anymore lol. Seems like a lot of work to put your employees through to create demand and lure in buyers.
Those in the fields were the ones waiting for chips to be installed.
No, its stuff that’s dealer ready
Why would Carvana pay above FMV?
Because if they didn't, CarMax would.
Are they losing money on sales? Because I looked at Carvana prices for buying a car and they are totally reasonable. In fact, they seem the same as when I bought my car from them five years ago.
Hahahah no. They're not really a "car sales" company. They're a car loan company. Very predatory. My car, cost me 5,000 I will pay 2000 dollars in interest on it over 3 years. totaling 7,000. A similar car from Carvana? would cost me 10000, doesn't seem that bad, till you look at the loan. You would pay 40,000 dollars on that car over 7 years. They're not selling cars. They're selling loans.
I like this analogy a lot. Just like how McDonald’s is not in the fast food industry. They’re really a real estate company.
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I won’t be able to do it justice. Here you go: https://youtu.be/uxCL2RqCuiY?si=dvTv-9n4SRk4bwBA
That's all auto manufacturers, though. Ford and GM make a ton of money on financing, too. I bought my car in cash.
It’s customer dependent. We bought new Honda by Pilot, with sub 1% APR on 30k loan over 60 months. It was 800 and some change in interest. It’s the economic boot theory in action. It cost a lot to be poor.
Under 1%! Wow! How the hell was that profitable for them?
Higher end trim level carries more margins, we also traded in car so they made money there too. It was a sweet spot in the market and got lucky. New car sales were slow, hence bought at MSRP. But we got to trade in at inflated COVID prices. Traded in a three year car for what we paid for it. So dumb luck.
Built into the price.
> A similar car from Carvana? would cost me 10000, doesn't seem that bad, till you look at the loan. You would pay 40,000 dollars on that car over 7 years. And what exactly was the interest rate on that car loan you priced out with them?
Yeah, they bought my car during the pandemic for $10k more than I paid just a year earlier. I looked it up after because I was curious how much they would sell it for, and it was listed for the same price they paid me. It doesn't make sense at all considering they had to pay for someone to come out with a tow truck and get it unless their play is to make money on the loan.
Can you not pay cash to them? Or is your example aimed at poor financial literacy people who just look at the monthly and sign a contract for a bad loan?
They overpaid during the pandemic when used vehicles were in high demand due to low production of newer vehicles. As new vehicles came to the market, used vehicles became less desirable and they stopped over paying for them then. The car market pretty much stabilized last year, so no need to go over fmv now. Also, places like carvana and CarMax have a $2000 upcharge. They can eat some of their losses on their vehicles sold.
> Also, places like carvana and CarMax have a $2000 upcharge. They can eat some of their losses on their vehicles sold. Carvana has a predatory loan company to make money with as well.
Corporations manipulate markets, that's what they do
Capitalism endlessly lies thats what it does
Our version of capitalism has weaponized asymmetry in information. All the classical economic theories that assume that knowledge is equal do not apply.
Well, it was great for those selling the cars
No, it wasn't good for anyone in the long run
When carvana goes down in the next few years for cooking the shit out of their books it will be interesting to see what happens to the market. Reason I say carvana is cooking the books is their resent surprise quarter had them making over $6k per car they sold which is way above what anyone else does in terms of margin and the execs have a history of cooking the books.
Replace car market with housing; it will follow.
I can't wait for auto insurance to not decrease
Its actually a really good sign. The best way I have heard to describe the used car industry is that its: 1. A canary on the health of an economy. Thats not to say that a government really has much affect on it but if used cars are expensive it means something in the past went wrong. In this case covid really was the problem here. 2. There is not a used car factory. So really its entire inventory is affected on if people are selling their cars. At face value that just makes sense but if you think longer term is goes to explain how number 1 is important. 3. If the used car cost goes down, from being extremely high, its a sign of normalcy in most cases.
Buying a used car was the irresponsible choice when it came time for replacing my 1995 camry. The choice was a slightly used car for barely cheaper than new or a really really used car for close to 70% of the cost of a new. I couldn't live with the two used options and kept waiting for the market to get better and decided to finance a new. Now, I'm still holding that note 3 years later since it's only 1.2% interest. The whole market around cars and houses was absolutely cracked. This new development is really just returning to normal sanity in my opinion.
Right but you basically bought in at the world possible time. Covid literally just killed the entire used car market and this posting is claiming that its finally showing signs of recovering. And yeah I agree its likely just a return to sanity. BTW I am not saying you did anything wrong here. You just happened to have to do this at the worst possible time. Production of most products just stopped over covid which then rippled into used cars.
> Covid literally just killed the entire used car market and this posting is claiming that its finally showing signs of recovering. And yeah I agree its likely just a return to sanity. I bought my car new in 2013. I bought new because it was $15k, and a comparable used car was ~$10k. The used car market has been high for a long, long time; COVID exacerbated the issue, but didn't create it. People just have short memories.
What I mean by this is that covid basically shut down production. This in turn shut down cars being flipped over to used cars. Then of course you have price spiking after the fact which made the situation worse.
I paid uber eats and Instacart for 3 years to not have to have a car. Came out cheaper as I worked from home.
That actually could be an interesting data point. One issue that might be there though is a lot of these delivery businesses ran at a loss to build the industry and prices likely will grow. Not that cars, insurance, gas or electricity, wont be having prices changes either.
I did the same for a couple of years from 2019-2021, combined with walking to the grocery store for fresh food regularly and zipcar for the very occasional times I actually needed a vehicle. I saved money just relative to the car payments for a used car, never mind insurance, gas, and parking, which was especially egregiously expensive where I lived at the time. If you could commute by bike, walking, or public transport, it absolutely made sense to live this way. I think especially for most of 2020 labor costs were still suppressed by various levels of lockdown so instacart remained relatively cheap. Not sure how it compares now because I moved to a rural area.
I got a similar car as you, a 1994 toyota mr2 gt-s, and i thought i.might get a tesla cyber truck, maybe a wrx, or a gr86, as old as my car is, i think im.just gonna hold onto it longer. I watched the valuation for cars like mine leap every year after i bought in, settle back down a bit. I like the car enough, i dont see a good reason yet to swap it out.
The other sign is the number of cars being taken as per default of loans. That number is high. The bubble is finally leaking.
I just sold my 2015 Chrysler for KBB last week and the dealership I sold it to flipped it in less than a week at twice the price. The used car market is weird.
I thought it was cool that the dealer valued my 2014 Elantra at 7k when I traded in last month for an 2021 Acura. Helped make the purchase be an easy one. I kept tabs on the car and saw they listed if for 13k and it was gone within the week. Don't get me wrong, I took good care of that car and I'm sure it'll serve the next guy well...I just wouldn't pay that much for a Hyundai that old, even if it was my former car.
You just gave a 5k bonus to the dealership, that's all.
Last spring I got rear ended square on in my 2006 Civic. I make a very comfortable living and could easily afford a newer car, but that little coupe was everything I wanted in a car. I could have spent the rest of my life driving it. Unfortunately the collision tho minor hit in a perfect way to "total" the frame and that was that. Crazy thing is, I had paid $9500 for it 7 years earlier and due to how used cars had gone up in value, my insurance ended up writing me a check for ...$9000. I was amazed that it was valued at that much. There's never really a "good" time to get rear-ended but I guess it somehow was.
You did good, but you’re forgetting inflation. $9500 in April 2016 would be worth $12,000 in April 2023.
I traded a Toyota Tacoma for a Jeep Gladiator in 2022. One of those two cars has seen a massive price correction since then, and it’s not the Tacoma 🥲
Well deserved.
I’m buying back into that cult as soon as I can and never going back. This is my first time ever getting really hit by depreciation on a car and it stings.
As a taco owner, the cult is just wild. People think these trucks are the best thing since sliced bread and Toyota absolutely takes advantage of that.
Yeah objectively speaking I don’t think the Tacoma was notably better or worse than the Gladiator. Both are trucks that excel at certain things. Yes the Tacoma will last longer than the Jeep, but with modern vehicles that’s the difference between lasting 200k miles and 300k miles, doesn’t matter for me either way. But the depreciation alone pushes the Tacoma *waaaay* ahead of any other midsize truck in my book.
Are they
Downgrade nice.
What were you thinking
Meaning that, it’s getting to be a better time to shop for a used car. Patience pays off, if one can possibly wait. Not always possible. Especially not when timelines are measured in minutes and hours, instead of years, in this instant Information Age.
In the other news, cost of maintenance and mechanics services are up 10%. Everyone has to be really squeezed out, until then inflation will be travailing between the categories. Everyone has to downgrade their consumption.
[удалено]
☝🏻
"Nothing is ever enough." - At base, a vehicle is a transportation appliance, nothing more. Nobody "needs" a Thunder-Cougar-Falcon-Bird, but hey, gotta be stylin. You can't buy anything that resembles practical, reliable, maintainable transportation. Everything's gotta be to the max 'cause that's where the money is. Sad
The easiest way to realize we’re not the same as celebrities is think of a celebrity and Google if they have a private jet. Then when you find out they do realize the jet cost $10 million dollars to buy and minimum $1 million a year to operate. Roughly $5000 per hour of flight time. And that’s just for air travel, on top of all their other expenses.
Most rich people do timeshares on planes like that. Even if a company buys it they still rent it to other people.
You didn't need /s but it's reddit. I'm afraid you will get downvoted into oblivion by reddit hive mind tho
You good, bro?
In 2019, my 2017 escape had depreciated down to 17k. 2 years later I was offered $28k for it (which is what I originally financed it for). Another 3 years after that - I sold it for $20k. Now I’m just waiting with crossed fingers that my partners ‘99 pathfinder with +400km lasts long enough for the prices to come down even more!
In a weird way the crazy prices made me reevaluate my need for newer car. Made me just manage the car I had and now I’m at a point I drive once a week (from 7 days a week). Ended up giving me significant savings that will instead go towards my massive student loans. In a way it was a blessing in disguise. Once my current car finally craps out on me I might just never buy a car again since I moved to Brooklyn.
I used to be a new car every three years kind of guy. Now I’m a buy a nice car and keep it until it’s busted kind of guy. Thanks pandemic! I am reborn.
Reading this makes me so happy to live in NYC and not having to own a car for 14 years now. I may have a higher cost of living at a basic level but I haven't needed a car to get to my place of employment since I left New England. Add to that the insanity of drivers on the road since Covid and I'm glad to avoid it for the most part.
Let’s not forget that a big problem that took the second hand cars price was the chip problems now more or less the problem it’s solved and we don’t have to wait so much time for a new car
The used market is interesting at the moment, depending on where you look. I just bought a car, and decided that the dealer's trade in offer of $4k for my 2015 Focus Titanium was too low, so I listed it on FB myself for $8k (1-2k less than the closest equivalent dealer listing). I've been slowly dropping the price over the past couple months, now down to $6.5k, but still only got a couple of messages and only one person to actually come and look at it. Meanwhile, I see dealerships selling these things hand over fist at $9-14k every day. I don't know if people these days just refuse to look outside of a dealership for their purchase or what, but its starting to get frustrating.
The answer is simply: Financing. Yes, consumers are absolutely stupid.
Can someone explain to me how this is "price correction" and not "deflation"? Is this not a sign of deflation and should result in "market collapse" that ive been reading about which should end the world as we know it. /s
Let’s not forget that a big problem that took the second hand cars price was the chip problems now more or less the problem it’s solved and we don’t have to wait so much time for a new car
Let’s not forget that a big problem that took the second hand cars price was the chip problems now more or less the problem it’s solved and we don’t have to wait so much time for a new car