MoneyConsumerDont Waste Your Money

Actions

Used car buyers are facing soaring prices and fewer choices

New car shortage trickling into to used car lots
A bargain hunter’s guide to used car shopping
Posted at 1:51 PM, May 28, 2021

The summer car-buying season is here, but many hopeful buyers are ending up with a severe case of sticker shock because used car prices are higher than ever.

Gary Heflin, the owner of a used car dealership, is busy these days trying to keep his lot filled with good quality used cars.

Eric Oliver has bought two cars from Heflin in the past, and he hopes to buy an SUV from Heflin.

"I prefer buying used," Oliver said. "You can get some good used vehicles in very good shape."

But used cars aren't much of a bargain anymore. Edmunds reports that used car prices are up 14% over the past year.

Heflin said there are several factors, and one is that new car prices have hit a record high of $40,000 on average.

That, combined with rental fleets no longer flooding the market with cars and buyers flush with stimulus checks, has created a supply-and-demand imbalance.

"There's a lot of people in the market," Heflin said. "It's just like with home sales and car sales. They are both doing well. But there's a shortage in both markets that drives up prices."

Heflin said Jeeps and any kind of truck, "especially pickup trucks, cargo vans, and work vehicles," are the most in-demand vehicle.

Ford F-150s are flying off the lot, he said, despite their higher prices.

Next to pickup trucks and Jeeps, he says three-row SUVs are the hottest sellers for families. Unfortunately, buyers will pay a lot more for them now.

What you can get for $10,000 or $15,000

For buyers looking to spend less than $15,000, Heflin suggests buying a 4-door sedan, not an SUV or pickup, which are commanding premium prices. Sedan prices are up only slightly this year compared to years past.

Heflin recommends 3- or 4-year-old Kias and Hyundais.

Why? Because, unlike other brands, Kias and Hyundais come with a five-year bumper-to-bumper manufacturer warranty, which is the best in the business. If buyers experience any problems in that first year, Heflin says they are covered at no extra charge.

Want to spend under $10,000? While there are plenty of cars for sale at that price point with at least 100,000 miles on them, Heflin cautions that there are not many low-mileage ones available.

"If you find something under $10,000 that you feel good about, don't wait," Heflin said. "Those cars are often sold in a few days."

Heflin also recommends getting a Carfax report and having older cars inspected. He says many high-mileage cars under $10,000 can be money pits with rusting frames or engine problems.

If you feel like prices are too high for what you want, drop down a car size and take your time. You'll eventually find something, with dealers predicting lower prices this coming fall, and that way, you don't waste your money.
__________________________

Don't Waste Your Money" is a registered trademark of Scripps Media, Inc. ("Scripps").

Like" John Matarese Money on Facebook

Follow John on Instagram @johnmataresemoney

Follow John on Twitter (@JohnMatarese)

For more consumer news and money saving advice, go to www.dontwasteyourmoney.com