why are used cars priced so high

[ironsniper1]

so im sitting here looking on craigslist for a car and i see a deal on a 01 nissan and look it up on kbb and mpg.gov and kbb says the price should be about 2500 and i think thats not bad of a deal i scroll down and see its 4500, i just dont understand why i would want to buy a used car rom that long ago for 4500 i smell either scam or something like that, if it was a luxury car like a bmw or something then i can understand

[Steelharp]

Just like used guns, there's more profit in them than new ones. Get 'em cheap, sell 'em as high as you can.

 

Magic here is the ONLY honest guy I know of.

[R_Bert]

Mostly they are expensive because millions of them were sent to the scrap yard a few years ago.  Stupid .gov programs have consequences.

[frankmako]

when i buy a use car/truck i check the price on all the use car pricing sites to get an average of what the vehicle should sell for.  then that i were i stand.  to many used vehicles to fall in love with one that is high priced.  today if you got money in hand you can just about get your deal with a used car.  if not move on to the next one.  

[peejman]

Cash-for-clunkers, Katrina, Sandy, the big Nashville flood, the economic recession...   There's a number of reasons the used car market is absurd these days. 

[R1100R]

They have been this way since 2009.  You can't find cars even at the Auctions for a decent price.

 

I know many dealer's who went out of business waiting for their money from the government due to Cash for Clunkers program. What was $2K is now 4K.

 

BTW most people that deal in Automobiles use Black Book. 

Edited November 25, 2013 by R1100R

[jgradyc]

Cash for Clunkers really did jack up the price of used cars, according to some dealers I know.  Asking $4500 for a $2500 car sounds about right for a dealer if its in retail shape and mileage, but it's way high for actually buying the car.

 

A lot of times, private sellers will go to kbb and price their car at the retail price that a dealer would ask. After they get no takers, they drop the price. Getting someone to come down $2000 on a $4500 car is probably not gonna happen, so you might as well keep looking. There is a real art to offering a low price on a vehicle to a private seller. You can't be the first person to look at the car. You have to go prepared with the KBB trade in and private party prices, you have to be polite, and you have to have to make a real offer.

 

"Would you take ____ for it"  is NOT a real offer. "What's your lowest price?" is not an offer.  A real offer is when you clearly state that you want to buy the car and are willing to pay $___ for it. 

 

Try this.

 

(After going to look at the car, driving it, and asking the owner about it, and politely pointing out that a few things aren't perfect.)

 

"It's a nice car. We both know it's not new and it needs a few things, but I can get those things fixed. That's not a problem. The problem is that I have a budget for a car and this is more than I planned to pay. Still, I like the car and I'm willing to make an offer. I'll give you $____ for it. I have the money with me. I'll pay you in cash and you can be done with this today... you won't have to waste your time showing the car to people who don't show up or want you to finance it. So... $_____ right now. What do you think?"

 

"I can't do that. (long pause) I'll take $_____ "

 

"I can go to $____, but that's it."

 

"No, I can go $____"  [this is what you wanted to pay all along!!!"]

 

[long pause by you.]  <sighing> "Okay, you got a deal."

 

Something along these lines normally works for me. My experience is that it is very hard to get a private seller to come down more than $1,000 on a $5,000 car, so I'd keep looking.

[Jonnin]

What always amazes me are replacement parts.   If you built a car from scratch using replacement parts, the average car would cost you a solid 250K or more. 

 

One thing to be aware of is that  the book price is for the basic models ONLY.  If the thing has leather seats and a pimp stereo system or built in gps / tv / ipad / etc gizmos,  and 1000 other add ons, the price will be and should be somewhat higher.  

 

There are other factors that should affect price (mileage, of course, condition in general, etc).  If its low mileage and nearly new, 4500 for what was 10k+ a few miles ago is a great deal.  If it has 150k miles on it,  that is a bit pricy..... 

 

Remember too, like guns, the guy selling has jacked it up because people want to make lower offers on it.  If he starts low, they still come in with lower offers.  And he wants as much as he can get too... that is how it works...

Edited November 25, 2013 by Jonnin

[Lumber_Jack]

I will not pay more that KBB or NADA used car value of corresponding condition.  Not gonna happen.  Thats the valuing system we have to go by, and thats what I use.  I would offer them "book" value and if they dont take...move on.

 

I hate the most when people want to charge 100% value of add-on features such as rims, tires, lift kits, etc.  At best the value if 40% of retail once its installed

[Lowpower]

Im selling my loaded 1999 Toy Rav4 for $2200 after I get back home from Thanksgiving. New tires, new brakes, clean, non-smoking 2wd

with 20k on the timing belt, water pump...Cheap, reliable transportation. It'll probably go to some high school student before Obamacare

is up and running and the economy tanks completely.

 

Lp

[Guest RebelCowboySnB]

 

(After going to look at the car, driving it, and asking the owner about it, and politely pointing out that a few things aren't perfect.)

 

"It's a nice car. We both know it's not new and it needs a few things, but I can get those things fixed. That's not a problem. The problem is that I have a budget for a car and this is more than I planned to pay. Still, I like the car and I'm willing to make an offer. I'll give you $____ for it. I have the money with me. I'll pay you in cash and you can be done with this today... you won't have to waste your time showing the car to people who don't show up or want you to finance it. So... $_____ right now. What do you think?"

 

"I can't do that. (long pause) I'll take $_____ "

 

"I can go to $____, but that's it."

 

"No, I can go $____"  [this is what you wanted to pay all along!!!"]

 

[long pause by you.]  <sighing> "Okay, you got a deal."

 

Something along these lines normally works for me. My experience is that it is very hard to get a private seller to come down more than $1,000 on a $5,000 car, so I'd keep looking.

Try this.

You would be going home without a car doing that with me. If you have a budget below asking, tell me before you come not after you have wasted my time. I will make deals if I can with people that tell me what they will pay. I will make deals if they look at the car an see some issue I did not. If you come here knowing you will never pay the asking price an then try to talk me down to what you do have I will show you the door.

 

How far you have drove to see the car has a lot to do with how much I will come off a price to. I will make a deal with someone before the drive or if they are local who just stopped by. Once we have talked  an you drove 200 miles to look you are invested an I no longer need to make any deals.

[bersaguy]

If your looking at any used cars from individuals they will always jack price up so they can negotiate some before selling and always make sure on used cars from individuals that you do a CAR FAX report on the car to get any accident history on the car. Most Body Shops are required to put the information on Car Fax about damage that has been repaired. A Car Fax report in your hand when you got to negotiate a deal will almost always get you a better buy on the car if you choose to still purchase it..........................jmho

[Dooley111]

I think it also has to do with new car prices. I went truck shopping a couple weeks ago and they want $60000! For a new diesel truck.

[hipower]

Mostly they are expensive because millions of them were sent to the scrap yard a few years ago.  Stupid .gov programs have consequences.

 

This is one of the major factors that will continue to cause ripples in the used vehicle market for several more years at least.

 

The "Cash for Cars" crap took literally hundreds of thousands, possibly millions, of good dependable late model cars off the secondary market and caused them to be crushed. 

 

This so-called helpful program was supposed to benefit the lower income people by getting them into an "environmentally cleaner, less problematic car". 

 

But it backfired. Pretty much the only people who could afford the cost of the new replacement cars were those who had late models and could benefit from the trade in deals.

 

Those driving the "clunkers" were supposed to be the ones buying all the new cars and help clean up the world. Yeah...right.

 

So  we got a generation of cars scrapped that could have been sold to the people who usually bought used vehicles. That pretty quickly drove up the cost of older vehicles.

 

I was working a parts job that had me in contact with quite a few new car dealerships, and saw the types of cars that were sent to the scrapyards. Many were things I personally would have liked to own. They were in better condition that what I was driving at the time.

 

And several people I spoke with at those dealerships were just as stupefied at the program. It cut out a tremendous profit area for them.

 

Just our government at work...saving us from ourselves.

[seez52]

sometimes luxury cars are more of a bargain on the used market than chevys if you compare the original price. They seem to drop like a rock after just a few years.

[jgradyc]

You would be going home without a car doing that with me. If you have a budget below asking, tell me before you come not after you have wasted my time. I will make deals if I can with people that tell me what they will pay. I will make deals if they look at the car an see some issue I did not. If you come here knowing you will never pay the asking price an then try to talk me down to what you do have I will show you the door.

 

How far you have drove to see the car has a lot to do with how much I will come off a price to. I will make a deal with someone before the drive or if they are local who just stopped by. Once we have talked  an you drove 200 miles to look you are invested an I no longer need to make any deals.

 

Just so we are clear, I'm perfectly okay with you not taking what I would consider to be a fair offer. 

 

I'm willing to take my time to come and check out the car and make an offer, which to me is above trade in but below private party market values.  My offer would always be several hundred dollars more than the car would bring at auction, plus I'm right there and ready to buy.  My daddy used to say, "Don't begrudge a man making a living, just don't let him make a whole month's worth off of you!" <where is the smiley face for an attempt at adding a little levity?>

 

You know what you have to get out of the car, I don't. You've got overhead to cover and other stuff to consider, I'm okay with all that. Best wishes.  

[Guest RebelCowboySnB]

I am not saying your price might not be fare, I might take the offer if it is brought to me up front. I am not a dealer. I am not in the business of spending time with tire kickers. Once you have read my ad, talked to me, got my address an came to my house we have passed the point of debating what you are willing to pay. Now if there is a reason after seeing the car that you are not willing to pay asking then we can talk. If I think you never planned to pay asking then I will send you on your way. I may even sell it to the next guy for less than you offered if he respects my time an is up front about what he will pay.

 

It has nothing to do with what is or is not a fare price.

[Sam1]

They're high because people are willing to pay that much:)

[No_0ne]

They're high because people are willing to pay that much:)

... ^ this!

[Sam1]

Think I explained it in chat one night to some people, learned an important lesson from my uncle as a kid when he was selling cars.  There's a big difference in the value and worth of a car.  The value may only be $5000, but to someone specific, that car may be worth $6000.  Then he finished the lesson with "because of that, I'm not selling this car to you for what it books for"  :rofl:

[Garufa]

Has anyone priced new cars lately?  ;)

[gregintenn]

Several years back, my wife and I were at a Honda dealership looking at Accords. We wanted one 2-3 years old. He had several, and gave us a price. Out of curiosity, I asked what a similarly equipped new one sold for......guess what? SAME PRICE!!!! I asked how that was, and he said people came there looking for late model used ones and never priced a new one. He told me they sold 2 or 3 used ones for every new one they sold.

[LawVol]

They're high because people are willing to pay that much:)

 

I was amazed at how much my sister got for her early 2000's V6 Mustang on Craigslist.  She had it sold in a matter of hours, too.

 

Several years back, my wife and I were at a Honda dealership looking at Accords. We wanted one 2-3 years old. He had several, and gave us a price. Out of curiosity, I asked what a similarly equipped new one sold for......guess what? SAME PRICE!!!! I asked how that was, and he said people came there looking for late model used ones and never priced a new one. He told me they sold 2 or 3 used ones for every new one they sold.

 

I bought my wife an Odyssey last month, and we couldn't find a good enough deal on a used one to justify it over new.  We looked at a used one at a Dodge dealership in town who couldn't (or wouldn't) even match the quote we had on an identically equipped new one.  It's still sitting on the lot.   :rolleyes:

[gregintenn]

I was amazed at how much my sister got for her early 2000's V6 Mustang on Craigslist.  She had it sold in a matter of hours, too.

 

 

I bought my wife an Odyssey last month, and we couldn't find a good enough deal on a used one to justify it over new.  We looked at a used one at a Dodge dealership in town who couldn't (or wouldn't) even match the quote we had on an identically equipped new one.  It's still sitting on the lot.   :rolleyes:

I went with the new Accord. :shrug:

[Trekbike]

sometimes luxury cars are more of a bargain on the used market than chevys if you compare the original price. They seem to drop like a rock after just a few years.

This...the more features a car has the more it makes since to buy used. On a basic model, many times the new price is not much more than used.