Used car prices dropped again this month as more vehicles hit the market and demand cools.
The average price is now down about 8 percent from last year’s peak.
This is providing some relief for buyers who were priced out during the shortage.
However, financing costs remain high due to elevated interest rates.
Dealerships say inventory is finally catching up with demand. Used car prices finally coming down is good news for regular buyers.
After years of crazy highs this feels like a real shift.
According to Cox Automotive’s analysis of vAuto Live Market View data, March used-vehicle inventory levels declined for the third straight month and were lower year over year, falling to the lowest level since at least 2019, when the current vAuto data sets begin.
Backed by healthy tax refunds and continued affordability challenges in the new-vehicle market, the used-vehicle sales pace improved in March in a seasonally normal pattern, resulting in a significant tightening of days’ supply. Average listing prices increased modestly from February.
At a 12.01% average APR for used cars, the math is brutal. An 8% drop in sticker price is almost entirely erased by the interest cost over a 60-month loan. For a $26,000 car, that interest adds roughly $150/month compared to pre-inflation rates.
