My home base is the great Northeast. As such, this past winter I thought summer would never come. But all that snow eventually melted, and with it so have new and used car prices. Summer is a great time to buy a car.
Prices in the used car market begin to drop this time of year for a couple of reasons. Demand declines after tax season and its flood of money from tax refunds. Consumers wait until their returns are filed and IRS checks issued to make down payments.
But the bigger reason is supply grows this time of year. Private sellers get more active, and more people are buying new cars, which increases the used car supply.
However, there’s another factor that comes into play. With the warmer weather comes a stronger desire to be doing anything but shopping for a new car. Dealers (both new and used) have to overcome strong competition from the beach, gardening, and outdoor activities to get people indoors to buy new cars. There’s a reason car shows are held in the winter. Who wants to be indoors looking at new cars when it’s 80 degrees and sunny?
“As expected, values in car segments continued their downward trend. Pickups and full-size vans are in demand and held their values well,” said Anil Goyal, vice president of automotive valuation and analytics at BlackBook. Its research shows all used car segments saw a decreasing change in values this past week. It says feedback straight from the auction lanes indicates inventories are at levels that make for a more discriminating buyer at auction.
Okay, so you’re ready to buck the trend, put down the sunscreen, and buy a new or used car. Where are the bargains going to be? In the used car marketplace, the deals continue to be in the compact car and luxury car markets. It’s a trend affecting the new car marketplace as well. Fuel prices are still soft enough that shoppers think they can go big with no fears. That means you should be able to negotiate beyond deals currently being offered.
An interesting place you may not find deals is in the van market. BlackBook reports that newer “European-style” vans are showing increases in retail pricing (think Ford Transit and Nissan NV200). Meanwhile, standard boxy-style vans continue to show increases in wholesale values before the supply starts to build up from the newer models. Buyers can’t get what they want yet new, so they’re going for used.
Dealers both new and used don’t want to carry inventory for too long on their lots. They have to finance what they don’t sell. If your credit is good, and especially if you arrange financing through the dealership, you’re going to be able to get good deals.
Remember, to help you buy your next car, CarGurus’ shopping engine analyzes millions of car listings to give you instant guidance on the best deals in your area. Plug in your zip code and the car you want, and we’ll show you which listings are great deals and which you should avoid.
Shopping for a car this weekend?
Bring along CarGurus’ mobile app to help check prices, find good deals, and research cars on your smartphone.