The good news for consumers is that used car prices are declining and experts expect the trend to continue in 2023. Unfortunately, the drop won't come close to wiping out the massive surge in values that stretched from the spring of 2020 to the beginning of last year.
Now Moody's Analytics says prices for used vehicles could fall by 11% or more in 2023 because of interest rates and the higher cost of living. It could be a good time to buy. Luckily, there are just as many benefits from buying new or used cars.
Yes, used car prices are falling in Australia from their ridiculous highs. But they remain vastly more expensive than they were pre-COVID. The average cost of used cars in Australia has now been falling for six months, offering some relief to buyers priced out of the hot market, according to a new report.
Whether you're shopping for a new car or a used one. New car prices are on the rise, breaking records monthly. Used car prices are starting to fall, and our experts tell us that both of those trends could be with us well into 2023.
Used car prices have likely peaked, but new car prices are set to remain elevated through end-2022. In 2023, prices are expected to decline by 2.5% to 5% for new cars and by 10% to 20% for used cars.
Don't expect car prices to drop significantly anytime soon. Instead, new-vehicle prices — already at record highs — will remain elevated, automotive experts say. At the same time, used-vehicle pricing should moderate as the Federal Reserve continues raising interest rates to curb inflation.
According to Kelly Blue Book, the second half of 2022 and the beginning of 2023 is showing signs of improvement when it comes to purchasing a vehicle, especially for those who are looking for a used vehicle. Waiting until late 2024 may bring price drops, as mentioned above.
If your mechanic is spending more time with your car than you do and your repair bills are close to new-car payments, it's probably time to trade up. Or your car may run well, but rust or collision damage can make it structurally unsound. The only older cars worth keeping are the ones that are reliable and safe.
Traditionally, new model year vehicles start to come out in the fall of the previous year. For example, a 2023 model will debut in the fall of 2022 — and dealerships usually want the old stock gone before the new model arrives.
According to Edmunds data, December has the year's highest discount off MSRP — 6.1% on average — and the highest incentives. Automakers and dealerships want to close the year with strong sales. They also want to get rid of the prior model-year cars that are taking up space, so they're motivated.
As new-car production improves, demand for used cars will ease up and prices will continue to fall in the new year. The firm estimates that used-car prices will drop 10%-20% in 2023; new cars, on the other hand, are predicted to see a modest decrease of just 2.5%-5%.
June, the end of the financial year for Australia, is usually the best time of the year to buy a car. This is when manufacturers and dealerships generally are slashing prices, offering lower financing, or free services for vehicles, to maximise yearly profits and reach their EOFY targets.
Key points. If your car is reaching the end of its lifespan, you may consider buying a new vehicle in 2023. Chip shortages, less inventory, and rising interest rates have resulted in drivers spending more money on new cars.
Consumer research firm J.D. Power projects new-car prices will fall somewhere between 2% and 10% next year, according to Tyson Jominy, vice president of data and analytics at J.D. Power.
Don't expect a crash.
Chesbrough also noted that there will be fewer used cars available for consumers over the coming years for several key reasons, which should keep prices elevated.
Historically, it may be reasonable to expect car prices to drop in a recession. However, there may be other factors that could significantly affect your ability to get a deal on the car you want.
When it comes to purchasing a new or used automobile in the next few months, experts say the longer you can wait, the better. Americans who have postponed purchasing a car for the past two years are finally getting some good news.
Focus any negotiation on that dealer cost. For an average car, 2% above the dealer's invoice price is a reasonably good deal. A hot-selling car may have little room for negotiation, while you may be able to go even lower with a slow-selling model. Salespeople will usually try to negotiate based on the MSRP.
The short answer is yes. However, for many, even the thought of negotiating new car prices can seem intimidating. Treat this experience like any negotiation and go in with a plan. The more thought you put into it upfront, the more confidence you'll feel about speaking with your dealer about the price of your new car.
Buying a five–year–old car may be an even better option. You won't get the latest features, but it won't lose so much in value. And you won't be shelling out so much each month on interest to repay a loan. But it's only better value if your mileage is low – under 10,000 miles a year.
In terms of the best time of the year, October, November and December are safe bets. Car dealerships have sales quotas, which typically break down into yearly, quarterly and monthly sales goals. All three goals begin to come together late in the year.