If you expected to locate savings in the COVID-19 pandemic, unfortunately you won’t place them in the used car market.
Again, you can earn a few dollars if you are able to drive with a vehicle, as the costs of the used car increase due to a rare confluence of points in the pandemic.
The reasons? Among them, others are flocking to the used car market, amid high new vehicle costs, low interest rates and shortages of new vehicles, according to the Edmunds automotive research site.
The average record of used vehicles worth $21,558 in July, an increase of $708 since June.
“This is an unprecedented historical replacement in the used vehicle market, where board costs sometimes decrease in this era due to depreciation,” Edmunds reported wednesday.
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Any hope that the hertz car rental company’s bankruptcy in Chapter 11 prior to this year will lead to a decline in the used car has been reduced due to COVID-19’s overwhelming influence on the market.
Ivan Drury, Edmunds’ senior manager of insights, said in a statement that there’s “significantly increased demand” for used vehicles, in part due to rock-bottom interest rates.
Also, automakers were forced to shut down plants for about two months in the spring due to work restrictions because of COVID-19. That led to a decline in new-vehicle inventory and a delay in 2021 models.
“It’s a seller’s market right now. While used cars continue to offer significant discounts compared to new cars, buyers of used cars will be placed in a position where they might not have as much bargaining force because demand is very high and dealers will be less susceptible to being flexible,” Drury said.
He asked buyers to be ready to act temporarily if they see a used car they want.
Price increases are strong for larger vehicles, which are in high demand. Large used pickups, for example, saw an accumulation of $2,301 in the average value of the list in July, reaching $33,264, according to Edmunds. Intermediate trucks that increased from $1,812 to $29,457.
“The used car is still at record levels, and in some segments some models are approaching the new Array car adding sports cars,” Kelley Blue Book car assessment service reported Monday.
That said, new-car prices still carry a premium for the most part.
According to Kelley Blue Book, the average value of a new vehicle sold in July was $38,378, a 2% increase from the previous year, but 1.2% less than in June.
Average July used car list prices, by vehicle segment, ranked by price change (with the increase from June in parentheses):
Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.