Used Car Values Are Plummeting Faster and Faster Across America, Report Claims
Good news if you’re buying…bad news if you’re selling.
As the old saying goes, we have good news and bad news for you. The good news is, if you’re in the market for a used car, prices are low—and getting lower. The bad news is, if you recently bought a new car, its value is likely dropping like a rock.
According to a Bloomberg report based upon data from Black Book, the average used car’s value went down 17 percent in the past 12 months. Most people who buy a new car know they’ll be taking a depreciation hit—but the rate at which values are dropping is almost double what it was in 2014, when the annual depreciation rate was 9.5 percent.
As always, some segments are depreciating faster than others. Of course, luxury cars are depreciating the fastest. Subcompact cars and full-size cars follow in second and third place due to generally low demand in those segments. Crossovers and SUVs are in the middle with pickup trucks depreciating the least.
So if you’re thinking about trading in a used car sometime soon, don’t get your hopes up. Dealers have an oversupply problem with all of these used cars, which is the main factor driving down the prices. The last thing they need is more used inventory, so don’t expect much for your trade-in.
The big silver lining here is the great deals you can get on used cars right now. If you’re looking for something entry-level and modern, you can get a dirt cheap used subcompact like a Ford Fiesta or Honda Fit. Need a family hauler, but don’t want a soulless crossover? Consider a gently used full-size sedan like a Chevy Impala or Nissan Maxima.
If you’re trying to get rid of your recently purchased car, however...we at The Drive say consider Craigslist rather than trading it in.