Thanks to COVID-19, the new and used-car markets have been unpredictable. Without vaccines or medicine, factory shutdowns have become commonplace and parts shortages have caused vehicle inventories to dry up. So is it a bad time to buy a car?
As new car inventory has shrunk, shoppers have devoured the stock of used cars as well, causing prices across the automotive spectrum to rise.
In 2021, common understanding meant that all of these pressures would reduce as the vaccines were available. This promised better deals for the car shoppers who were willing to wait. But that is not exactly what happened.
For easier navigation throughout this post feel free to use our table of contents below.
Whether you’re looking for a used or new car, COVID-19 has affected and altered the car-buying process. Now, when you identify the vehicle you want, you will likely have to order from the dealership or the factory and wait several months for the car to arrive.
Then, new cars that do make it to the lot will be sold already. Finding an unsold vehicle is like finding a four-leaf clover out in a field full of daisies, said George Hoffer, Ph.D., an emeritus professor of transportation economics in the School of Business at Virginia Commonwealth University.
Gas prices are on the rise, so if they don’t decline soon, expect a shift from seller’s to buyer’s market. That’s what happens with every unpredicted increase in fuel prices ever since the 1970s. Since the most in-demand vehicles are always the most fuel-inefficient, Hoffer thinks new vehicle markets will be especially vulnerable to this trend.
The current situation in the economy should lead to a sales rate of about 17 million new vehicles per year. However, the actual sales rate has only been around 15 million units per year since 2022.
The rising prices of new vehicles and falling prices of used vehicles are causing this discrepancy. Used vehicle prices have risen by around 40% since 2021, while new car prices have only risen by about 10%.
Many car shoppers wonder – is it a bad time to buy a car? New cars are a much better buy if you avoid dealerships charging more than the MSRP. There are dealers who are even going to the extent of adding market adjustment surcharges as much as five digits.
In case you find such a dealer, leave them and get another dealer. Car factories are doing their best to get such dealers under control. One way they are doing this is by threatening to bring down their vehicle allocations.
Online portals allowing customers to purchase vehicles directly from manufacturers have gained popularity. These sites are likely to continue. Certain manufacturers will offer a discount of up to $1,000 if you buy through their website. Many manufacturers offer subsidized financing for well-qualified buyers.
Granted the interest rates continue to rise, finance subsidiaries owned by manufacturers can borrow at lower rates than other companies and therefore offer low-interest rates as an incentive.
When searching for a used car, consider reliability and dependability. The car may have high mileage, but history can reveal how many problems it has encountered. Not all dealers or sellers are entirely forthright about their vehicles’ issues; some will hide any problems they know about.
Getting a good used vehicle for under $10,000 doesn’t have to be a challenge if you do your homework. If you want to find a dependable used vehicle that will not require you to break the bank, you’ll want to see our list below of reliable used vehicles that are also affordable to many car buyers.
The Toyota Camry remains the top-selling passenger car in the United States. The key reason behind its popularity is its reliability. 2015 Toyota Camry gets its place on the top ten most durable vehicles.
Consumer Reports has been rating the Camry since 2000, and it’s gotten five out of five every year except for 2003 and 2005. It got a four-star rating in those two years. Overall, Consumer Reports state the Camry is well known for reliability, resale value, and great safety features.
The Camry is dependable and one of the most dependable used cars you can buy. It has very good owner satisfaction reviews and ratings, too, giving it more appeal than a Toyota Corolla, which competes within the same brand.
If you’re looking for an all-rounded, affordable family vehicle with great safety ratings, opt for the 2015 Toyota Camry. The sedan also won the 2017 and the 2018 “Best Used Cars for Teens”, and it’s easy to live with thanks to its quiet cabin, stylish design, and great safety features.
In 2016, Mazda produced its fourth-generation Miata. It became a hit with Car and Driver and was named one of its top 10 cars for 4 years consecutively. The Miata, which comes with either a manual or automatic transmission, features a 155 hp four-cylinder 2.0-liter engine.
The 2020 Miata also received a reliability score of five stars and currently enjoys a top rating across all the 17 categories on J.D. Power. Similarly, the Miata 2019 model has the same reliability accolades, along with a five-star rating for its owner satisfaction.
If you’re looking for a reliable compact car, look no further than at a Honda Civic. This popular car was fully redesigned in 2012 and got crash test scores that were excellent by the National Highway Traffic Safety Administration (NHTSA).
The Honda Civic was the top-rated compact car of 2012 by U.S. News & World Report. The Honda Civic owners are expected to pay fewer each year in costs of ownership than the average in its segment. Even better, you are able to get the Honda Civic for less than $10,000!
The Honda Civic, refreshed in 2012, gets an excellent fuel economy rating (25 miles per gallon in the city and 28 mpg on the highway. This is when it is paired with the automatic transmission). It also has top crash test ratings. The folks at Consumer Reports weren’t as excited with the handling and the road noise though.
The 2012 Honda Civic comes as a sedan or coupe, with most models equipped with a 140hp 4-cylinder engine. The engine is mated to either an automatic transmission to a five-speed manual transmission.
Honda Accord owners are raving about the reliability and dependability of their vehicle’s engine. These family-sized cars have been some of the most reliable and best-selling cars in the United States for over 15 years! 2013 was the model year that had the highest ratings on reliability and owner satisfaction.
Honda’s new Accord picks up where the previous model left off by introducing the Honda Sensing bundle featuring more advanced safety features and driver assist. These features are now standard for all Honda Accord trims from 2016 above. The Insurance Institute for Highway Safety also named the 2013 Honda Accord a Top Safety Pick+.
The 2013 Accord is a midsize sedan that’s roomy, comfortable, and has awesome fuel economy. Compared to earlier years, the 2013 Honda Accord features slightly more space for your cargo and more room in its sedan models.
The Mazda3 has maintained high-reliability ratings for up to eight out of nine years. The engine, transmission, braking system, power equipment, and finish have passed extensive testing over the decade ever since 2010.
The Mazda3—with its superb handling and its great fuel economy—is a standout as far as compact cars go. The overall dependability and value of their used cars make Mazda vehicles a smart choice for a car buyer. Consumer Reports says that Mazda’s solid reliability history makes it a good choice for buying used.
The 2018 Mazda3 boasts a good score on safety and as well as plenty of advanced features. The mazda3 received a 2018 Top Safety Pick, and the NHTSA has given it an overall five-star rating. Standard features include a rearview camera as well as a low-speed forward collision warning that also comes with brake assist.
When looking for a hybrid car with great reliability, the Toyota Prius 2011 is your best bet. The Prius comes with a perfect reliability rating score of five stars and has also won awards by U.S. News, including its 2011 award for Best Hybrid Car for Families and Best Hybrid Car for the Money.
The hatchback is a superior cargo carrier having plenty of space to carry your stuff. It also has among the best scores on safety scores for 2011.
The Last 4 Months. Experts suggest that used-car buyers shop for their cars in the last 4 months of this year. This is because next year’s models start to roll into the dealerships during early fall and even during the late summer period.
The car dealers will be more willing to bring in used vehicles for trading in. Both car manufacturers and dealerships want to ensure that they can reach their sales goals for the year with both used and new cars during these months, which is why the holiday season becomes so important for car salesmen.
Buyers looking for used cars might want to steer clear of the time between spring and summer when there are fewer deals.
It’s likely that they’ll wait until the new model year is available, which happens at the end of summer or the beginning of fall.
When the demand for the new vehicles decreases, there’s less of a supply of trade-ins—and less competition among sellers, which means higher prices.
If you have plans of buying a used car and are wondering is it a good time to buy a car, it might be best to avoid the period between President’s Day and Memorial Day.
That’s when the tax refunds are coming back into the bank accounts of consumers who are therefore looking to spend it on big-ticket items like cars.
Car manufacturers are aware of this. Therefore, it is less likely for them to offer incentives or deals during this period as they know they will sell the cars anyway.
In the past, most car-buying was local. Finding (let alone buying) a vehicle from another city or state was very challenging. Most searches went as far as the Yellow Pages would allow.
Today, with a few keystrokes, you can locate the exact new car or used car you’re looking for. It might be across town or it might be across the country.
While there are some extra steps to take, buying a car from another state doesn’t need to be a daunting experience. If you buy from a dealership in a neighboring state, the process might be as simple as purchasing one locally; buying from a private party in another state adds some complexity, but not too much.
People buy cars in other states for many reasons. Some people, such as those living in the Washington D.C. metro area, live in a region that includes multiple states.
Other buyers might cross state lines in search of specific cars or great deals. you may find that you are getting an awesome deal from a dealer who is outside of your state. In this case, you may want to take full advantage of the deal. For instance, a car in a different state may cost way less to buy and ship than one in your state.
Keep in mind that the cost of the vehicle may also be influenced by the supply and demand of car buyers in the region. If there is low demand the prices will be a lot cheaper.
Buyers of collector cars frequently have to buy cars in different states to get just the vehicle they want. For instance, you may love buying vintage cars. Needless to say, these are not always readily available and you may find that the only dealer with the model of your choice is in a different state.
In such an instance the only option is to buy the vehicle from a different state.
In different parts of the country, different cars are more popular. For example, you may be able to get a great deal on a Mazda Miata roadster if you buy it in Seattle instead of Los Angeles.
Similarly, you may be able to find a four-wheel-drive full-size pickup truck more easily in Phoenix than in Billings, Montana.
Don’t assume that you can avoid paying sales tax, registration fees, and safety inspections on a car by buying it out of state. Most states require vehicles to meet the regulations and pay the sales tax for the location where they will be kept. To register your vehicle in most states, you’ll have to pay any sales tax due and get it inspected.
You should try to avoid buying a car sight-unseen, as you may end up with a vehicle that’s far different than in the advertisement. Chasing deals that seem a bit too good to be true can waste your time and money if the deal doesn’t exist.
If you’re buying a car from one state and registering it in another, keep this in mind: Even if the car meets the standards of the state where you’ll be registering it, it still might not pass inspection in the state where you’re buying it.
Tailpipe emissions and inspection requirements vary from state to state.
For example, the California Air Resources Board (CARB) and several other states that follow their standards have adopted a rule that requires vehicles to meet certain emissions standards.
California for instance doesn’t register cars unless a vehicle is legal to sell in all 50 states, has fewer than 7,500 miles on its odometer, or has been modified to meet CARB’s standards.
If you import a car from one state to another where it doesn’t meet the state’s standards or can’t pass its inspection, you may be in for an expensive surprise.
As any savvy car buyer knows, now is not a good time to purchase a used or new vehicle. Used car price indices are quite high in 2022.
They have dropped slightly at the wholesale auctions so far this year, yet sellers are still having higher-cost second-hand car inventories.
Normally, used vehicle prices are at the highest during spring as Americans make use of the tax refunds. But if the wholesale prices will continue to drop, a car buyer might consider getting a used vehicle in the following several months.
However, the prices will still be high any way you look at it. That said, if you need a car, you will have to still be in the market.
Factors that range from bad weather to a new virus outbreak have stymied the predicted recovery, so the stock of new cars will not start to increase until late 2022. Even as cars start to come out of manufacturing lines much faster, they’ll still be taken just as fast by eager shoppers. Car companies are not likely to resume using incentives to enhance the deal for the would-be buyers until at least early 2023.
The prices of used cars may drop by 20% or even 30% by October 2022, according to research firm KPMG. A survey done by GlobalData discovered that up to 49% of automotive executives expect the chip shortage to be over at some point in 2022.
Why are used cars so expensive nowadays? The scarcity of microchips is not going away, and the world has been forced to slow down its production of new cars. dealerships adding high markups and the lack of choice are forcing buyers to go for secondhand vehicles.
October, November, and December are generally safe bets for car buyers looking to strike a deal. Dealerships have sales quotas, which are typically placed in categories of yearly, quarterly, and monthly goals. All three goals come together late in the year as buyers become more desperate to buy a new car by Christmas.
Financing your car can be a complicated process. When you go and take a car loan, you will essentially be agreeing to pay the amount of money that you received from the bank, with interest including any associated fees, within an agreed time period. By shopping for and comparing different loans, you can get offers and save a lot of money on both the interest rate as well as fees.
It can be one to two days to finish the process of buying a car. As soon as you find the car, you have to complete some paperwork. This process usually takes about an hour. When trading in the car, it can add anywhere from one hour to several hours to the process as the dealership needs time to evaluate the car and give you an offer.