A new study carried out by the car shopping site, Edmunds.com, shows that prices for used cars are getting higher and higher, going up 7.6% each year, and reaching an average of $18,800 at the moment.
In the second quarter of this year, the average transaction price for new light-duty vehicles reached a $33,340 record.
Jessica Caldwell, analyst at Edmunds.com, stated that prices for used cars go up as new vehicles are getting more and more expensive. She added that “People are buying more trucks and SUVs, and they’re getting them better equipped.”
There are a number of factors that trigger a price increase for used cars: better economic perspectives in most countries across the Globe following the recession, lower unemployment, smaller interest rates, and, of course, lower gas prices.
Pickup trucks, the most popular vehicle on both new and used car markets reflect the most significant price growth, reaching an average price of $23,081, meaning an 8.7% growth since last year.
Off-lease cars are part of the reasons why the used-car market is going up at the moment. The recession limited the used-car market, and made people hold onto their cars for an estimate of 11.5 years, on average. However, things are about to change.
The new-car sales business is predicted to exceed 17 million units this year, a premiere since 2001 and the used-car market will certainly follow the trend. Certified pre-owned (CPO) vehicles with extended warranties, which have been successfully inspected and repaired cars contribute to the ongoing popularity of used-cars. People want to be sure they are not investing into a used car that will not break in a few months, and CPOs are a warranty that they can buy used-cars and enjoy driving them, at an affordable price though compared to new cars’ prices.
By Gabriela Florea