March 10, 2022 by Rick Griffith
Before COVID-19, used car sales were singularly the most affordable way for most consumers to buy a new car. During COVID-19, though, prices on used vehicles skyrocketed a whopping 25%. But post-pandemic used car sales are beginning to drop again.
So, if affordability is still high on your list when it comes to purchasing a vehicle, then you’re going to want to keep reading to find out where used car sales are headed if you’re looking to buy in the near future.
In February, used car prices showed signs of dropping, averaging almost $600 less compared to prices in December 2021. Despite these slow downward movements, post-pandemic used car prices will continue to fall. But don’t expect costs for used cars to return to the pre-pandemic days.
Before the pandemic hit, used car sales behaved as expected; slow depreciation values kept costs trending downward. But as the pandemic ramped up, impacts on the financial markets became erratic and unpredictable. Nevertheless, by mid-year 2020, used car sales were upswing, jumping $2,000 to $4,000 more per used car.
Then there were all the supply chain issues:
In the end, the supply chain impacts included shortages in human capital, such as a massive workforce reduction in available truck drivers and product supply—not enough computer chips for installation into a new car’s onboard computer system. All these factors slowed production and delivery times to dealers across the nation. With that many problems in the supply chain, it’s no surprise that the used car industry reaped the rewards.
Although the used car industry profited from the pandemic, and market trends continue to stabilize for used car dealers, the prices might not dip back down to pre-pandemic days. So, what does that mean for you, the consumer?
Keep in mind used car prices are on the way back down, and markets are stabilizing. So be patient and do a little homework to stay current on your local market.
Used car purchases will be largely attainable for many as we move further and further into 2022. It helps to keep a dutiful watchful on Car Credit’s used car inventory to watch for price drops and sales on your favorite cars. Lastly, get connected with Car Credit; we can help you find what you want.