Used car sales are booming right now. The main reason for this is the debilitating state of the automotive industry due to the Covid-19 pandemic. Supply chain disruptions and social distancing have made it difficult for auto-makers to keep up with typical production rates.
Used car sales are up, and their values have increased by about 15% compared to previous years. Low-interest rates have helped more car buyers get a new car and inspired car rental companies to sell off older inventory.
If you are thinking about buying a used car or selling your old one, it is important to find out the current market value to make sure you are not paying or asking too much.
Your Car’s Value
Value is usually measured by how much someone is willing to pay for something and not necessarily the asking price. Now is definitely a seller’s market because with over a year of in-house employee restrictions or complete shut-downs, many people are still struggling to get back up to the economic level they enjoyed before the crisis. This makes the prospect of buying a new car impossible, so they look for a quality used car. Used car sellers can take advantage of this demand and ask a bit more.
However, as a buyer or seller, it is still important to know how much a car is worth. Determining a used car’s value is quite simple. With so many online tools, pricing information is easy to find. A few clicks will instantly tell you the current market value for any make, model, and year. Good pricing guides include:
- Kelley Blue Book (KBB)
- Edmunds
- National Automobile Dealers Association guides (NADA guides)
Look into sites like AutoTrader and Kelly Blue Book that specialize in trade-in values, private sales, dealer prices, and certified pre-owned values for more in-depth pricing. These sites set standard prices based mainly on the type of vehicle. All of these sites offer a convenient online estimator tool. Just plug in some basic information and instantly get an estimated value.
However, these guides are not created equally. Each company uses its own valuation algorithm so that you can get different results from different sites, but each will give you a good idea of what to pay or charge for your used car.
Classified ads posted by a private party may value their cars above or below recommended prices. However, you are always better off going with a private seller rather than a dealer. Sites like PrivateAuto specialize in making the car buying experience safe, simple, and secure. Financing options are at your fingertips so you will be rolling in your new wheels sooner than you thought possible.
Market Value vs. Book Car Valuation
Most people will base a car’s worth solely on the book value. However, you should consider the market value with today’s fluctuating market conditions. Trends go up and down, and right now, the trend is for used car prices to be higher than usual. Listing your car for the book value during this type of trend will attract more buyers, but you could be selling yourself short. A dealership will usually stick to the book value, that is why you always get a better deal from a private seller. They are not bound by the blue book and are in a much better position to negotiate.
Market value is based on what people are willing to pay. eBay and CraigsList are great examples of this: If you want to buy something but don’t know how much it is worth, you simply look at what the product has sold for in the near past. This tells you the current market value. Always keep in mind that a car’s condition, mileage, and physical or mechanical damage will have a huge impact on the price of the vehicle.
Information You Need to Estimate Car Worth
No matter which value estimator you use, the information you enter is basically the same. Info like make, model, and year is standard. You won’t get anywhere without this. Your car will depreciate over the years, so if you enter the mileage, vehicle condition of the car, or maybe the vehicle identification number (VIN), you will get the most accurate estimate possible. Remember, be honest. Tweaking the truth won’t help you at all.
If you have made any improvements or your vehicle has some extra features, make sure to mention this in your ad and in your estimator. This will increase your resell value and maybe attract more buyers.
Car Values in Your Area
A car is usually worth what it is worth. However, there may be exceptions. For example, if your car is rare and in-demand where you live, it will sell for more. Also, if everyone and his brother has the same car for sale in your local market, the value could go down. It goes back to the same old “supply and demand.” The higher the demand, the higher the price and vice versa.
Conclusion
Knowing your car’s value is a good start to the selling process. You don’t want to charge too much or not enough. Do your homework to find out the true value of your car and base your price on the current market value, not the retail value. Some people love their cars so much, they can not accept that it may be worth less than they think. But, if you want to sell your car, you need to determine what your car is worth, not how much you wish it was worth.
Use PrivateAuto to sell or find your next car at privateauto.com.