The cost of cars is out of hand, but, finally, prices are dropping. The falling price of used cars could see an improvement in overall inflation recovery. Or is this just a juncture in the collapse of the American economy?
Used car prices are falling, and they are falling fast. Compared to new cars, used car prices are looking quite enticing. The pandemic, and the two years that followed, saw the price of used cars go up by almost 70%. Since then, a lot has changed. Used cars are down 15% from late 2021 and experts foresee even better prices to come. New car prices, on the other hand, are still absurdly high, which makes buying used an even better option for consumers looking to save a few dollars on a vehicle. The drop in used car prices could be an indicator of a recovering economy, but even if it is not, it will still help inflation as well as the average consumer. Americans looking to buy or sell used cars should be wary of what is to come.
Are you looking into buying a used car? Now might be the best time to buy, but keep reading because you might want to wait just a little bit longer.
Used Cars and Inflation
Why did used cars become so expensive? Was it because of inflation? Yes… and no.
Back in early 2020, when the Covid-19 Pandemic froze the entire supply chain of just about everything, the cost of used and new cars began creeping upward. A lack of supply meant lackluster inventories at car dealerships, which, in turn, meant higher prices for new cars. These new prices, as well as a low supply of new cars, made the demand for used cars shoot up almost overnight. And since the demand was so high for used cars, their price of them began to increase, too.
It wasn’t until early 2022 that the price of used cars really began to deflate, and surprisingly, this has little to do with inflation. Supply and demand are returning to normal, but inflation is still hurting the American economy. According to CNBC.com, the price of used cars is still heavily affected by inflation.
The fact that used cars are going down in price is a good sign. It means things are getting back to normal, which should include inflation, according to Forbes.
Is Now a Good Time to Buy?
Is now the right time to buy a used car? That depends.
Yes, used cars are going down in price, but experts expect prices to go down even further. If you need a used car right this minute, then buy because costs are down, and you’ll be saving a little bit of money. But if you can wait, you should. Prices are going to keep falling throughout 2023, and you’ll be doing future you a favor in the future by considering the used car market. Plus, inflation might subside a little in the months to come.
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