The Used Car Market Is Collapsing

It's widely known that cars used to be depreciating assets. The moment you drove them off the lot, they'd lose a significant amount of value, and this decline would continue over time, measured as the residual value. This made sense because, unlike stocks, bonds, or land, cars are assets with an unlimited supply that eventually wear out and go out of style. But after the unusual events of 2020, the car market did something unexpected. Used cars began to appreciate in value, causing prices to skyrocket across the market to levels that were once unimaginable. The car bubble had grown to a point where everyone believed it would implode, and right now there are signs that maybe this prediction has some merit,

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[firstlast]

For years everything was supposed to collapse yet years later nothing.

[NavyMooe]

Click bait title
Title: used car prices are collapsing
Conclusion: prices aren’t collapsing as much as people expect.

[johnfaris]

I’ve been in a used car market in Las Vegas for 24 years and prices have been crushed over the last year or so. Government stimulus artificially pumped up the car market from 2020 to early 23, but when that stimulus money ran out car prices tanked. Most of the cars I sell are under $10, 000 and I would say prices are down by about a third over the last year. It’s largely due to all the repos. The glut of repossessed cars is driving down pricing everywhere and it has become tough to make money. Sales prices are down yet the cost of everything is through the roof. Rough time in the used car market.

[ekanata]

I love my $5000 Toyota which has never let me down and I do all the maintenance myself and has retained its resale value pretty well.

[nickvin]

Actually the new car market is crashing. (leading to the used car tanking)

[WonAll]

I sold a used car and I had to discount it to my rock bottom price. I tried to sell a family members car and I couldn’t get his rock bottom price. With repair costs so high, if their is anything wrong with the car and you have to discount the cost of the repair to the buyer, it won’t be worth selling. People are very tight with their cash in the used car market. I don’t blame them either

[monterreymxisfun]

I gave up on the car market two years ago. Taking lessons from mechanics in Mexico and Cuba, I rescued a junk car. I'm glad that I did. I especially like the opportunity to customize. This is not an entirely new thing in the USA. Remember people who discarded the engine in Chevy Vegas and put in a 350 CID V8?

[kyllllllllle]

Today is my first day on Prozac, so I’ll be happy either way. 😁

[sheepman]

I scored a Toyota Van with 14k miles on it for 14.5k last year. The used car market has indeed busted.

[mfenix]

I sold my 2018 chevy cruze LS with 87k miles to a chevy dealer for $8k-they initially offered $7k-I needed to sell my car quickly to buy a house and move. They listed it for $14k...like wtf. Car dealers are like Gamestop where they give you $1.50 for a used game and then sell it for $20. I hope they all go bankrupt and we can buy directly from the manufacturers.

[jones]

Interests rates are crazy, new cars 6-8% rate, used cars 10-13%

[signalfire]

Beware all the flood cars coming from everywhere.

[whou]

I find it interesting when one channel that I subscribe to references another channel that I subscribe to. I'm not sure if that means I am stuck in some sort of confirmation bias or that I am selecting multiple good sources.

[JorgeOrpinel]

The lease cliff is inconsequential: People who bought off those leased cars will either become sellers OR if they keep them then they won't be buyers... So there's no net difference in supply OR demand.

[christianchellis]

But I still feel like used car market make a big u-turn and come back. Ppl just trust used cars these days. They are reliable with high milage.

[animusadvertere]

Yep, i'm one of those who leased early during the pandemic (2020) then bought out my lease (2022, before interest rate hikes). Got lucky I guess. Crazy times.

[clarkdavis]

The new car market is collapsing also everywhere

[alabama.worley]

We also have the subscription model which has entered the space.

[DavidMartsolf]

I think used car prices will not collapse further for the simple reason that new car prices are now so high that people can't afford them.

[qtnqxlm]

In 2001 I got a $2, 000 car on installments that ultimately cost me over $10, 000... But what could I do. I needed a car and only had $1, 000 to put down on it... As it has turned out it has been the best running car I have ever owned... Mazda 2 2013 runs like a little tank and has been massively reliable