Used car prices are soaring around the country, leaving potential buyers floundering. In Massachusetts, used car prices have risen 35.4% since last year. Believe it or not, this is below the national average of 36.9%! So, what are consumers to do? Here’s how you can better understand what’s happening and respond accordingly:
Know why used car prices continue to rise
Most experts agree that the cause of the surge in the prices of used cars is an inventory shortage of new cars. When the pandemic hit in 2020, many auto plants reduced or even halted production entirely. This attempt to curb the virus’s spread reduced the supply of newer cars, driving up prices for both new and used cars.
Continued supply issues, mainly regarding semiconductor chips, have caused the supply of new cars to remain high. Therefore, more would-be buyers of new cars have pivoted to used cars. So, the prices go up for everyone.
Know when prices will come back down
Experts do not believe this price surge will be permanent. Most believe that the prices will come back down sometime in late 2022 as production of new vehicles returns to normal levels. Some firms even predict a dramatic fall in prices as new vehicles flood the market before a more sustained stabilization.
While people may disagree on when exactly prices will come down, they all agree that it will happen. The current spike in car prices is unsustainable, which is a huge relief for buyers. But what can they do in the interim?
What to do until prices stabilize
Aside from simply waiting, there are a few things consumers can do to help reduce their vehicle costs for the next few months. Vehicle maintenance is expensive, to be sure, but it’s far less expensive than buying a car, especially in the current climate. So, making sure you do proper routine maintenance on your vehicle will reduce your costs while avoiding the headache of having to find a new car. Things like rotating your tires will also reduce your gas costs, as gas prices are still quite high.
You can also reduce costs by taking public transportation more frequently, if your city or town has enough infrastructure for it. And if you don’t rely too heavily on your car now, it’s a good time to sell your car. We can help you transport it to any buyer you find, and you’ll make a pretty penny selling it in the current environment.
Yes, used car prices are very high at the moment. But don’t despair! In the not-too-distant future, this relic of the pandemic will fade into the background.