Used Car Prices Plummet, But Retail Prices Remain

The time has finally come for things to return to the way they are supposed to be, and with that is the decline of used car prices. Used cars, over the last few years, have become increasingly popular, causing the prices of them to shoot up exponentially.

Over the last two and a half years, people all over America have been struggling to find good prices for both used and new cars. When the Covid-19 pandemic shut down the world as we knew it, people stopped going to car dealerships and started shopping for cars online. It was during this that prices for cars, both new and used, grew to exceed their expected values. At one point, used cars were estimated to be being sold for more than 70% of their actual worth. That’s criminally good for used car salespeople. But what did this mean for everyone else? The last few years have been tough for anyone looking to buy a car. But there is light and the end of the tunnel. Recently, prices for used cars have begun to decline, and that might not be the only bit of good news to come.

Why Were Prices so High?

Before we get to the good news, let’s gloss over how we got to be in such a tricky position in the first place. Flashback to early 2020, the world in a frenzy, and every business in America scrambling to figure out how they would stay afloat in the coming months if not years. With people opting to stay inside and not visit dealerships, buyers and sellers alike had to make some changes. Used cars, from the likes of Facebook Marketplace and Carvana, became favorable options for people who were looking for a budget-friendly, more convenient buying experience.
The Pandemic proved unfortunate for retail dealerships. There was a massive shortage in cars and parts, and dealerships struggled to fill their lots with cars to sell. In turn, they higher their
prices to keep earnings steady. This also drove people towards buying used cars and seeking out used car dealerships.

What Happens Now?

What happens now, now that used car prices are on the dip? Well, considering retail prices are not budging (yet), the choice to buy cars used might still be the best option. Think about it. With prices getting lower each day, the odds of you buying a used car for a good price gets better every day. It is estimated that used car prices will continue to drop, most likely until they reach their actual value. Retail, on the other hand, is going to take a little bit more before it starts to drop. But, luckily for buyers, it is only a matter of time before this happens, too. As a buyer, you have a few options in front of you: You can buy a used car now, and enjoy the lower price, you can wait until used car prices are even lower (that might take some time), or you can wait until retail prices begin to drop, but who knows when that is going to happen.