Have you noticed? Used car prices are soaring.
The average price tag on a used vehicle hit $20,084 last quarter. That’s the highest since 2005, and it’s up 3-and-a-half percent from last year. All this according to the auto website Edmunds.
Those higher prices are hitting consumers in their monthly payments. Edmunds says the average payment for a used vehicle has hit $400 a month. That’s a record high.
So why are you paying more for a used car, part of it’s due to higher interest rates and part of it is due to the overall shift to SUVs and pickup trucks.
If you’re looking for a used car bargain, consider a sedan. They’re less in demand and you may find a deal.
Another thing to consider is leasing. Used car loans are averaging around six-years in duration.
So you may end up with a vehicle that’s a decade old by the time its paid off.
And when you consider the high monthly payment for many used cars, you may be able to find a leased vehicle with a lower payment.
If you are planning to buy a car this year, you may want to wait until the last week of the year if you can. That’s when dealers feel pressure to get cars off the lots. You may find it’s easier to bargain for a lower price.