Used car prices continue to rise in the United States, with the average transaction price of a second-hand vehicle topping $27,000 for the first time ever in November 2021.
According to market research firm Cox Automotive, the average listing price of a used vehicle throughout November 2021 was $27,569 – up over $400 from October’s average of $26,976. This average list price was also up 27 percent from November 2020 and a significant 41 percent from November 2019.
While prices remain elevated, inventory is beginning to return to usual levels after high demand emptied used car lots earlier in the year. The total supply of unsold used vehicles on dealer lots across the U.S. in November stood at 2.31 million units – up from 2.25 million units in October. Still, the used vehicle supply in November 2021 was still 11 percent lower than in November 2020.
Not surprisingly, affordable used cars remain the hardest to come by. Vehicles priced at under $15,000 had the lowest supply last month at less than 10,000 units. The $15,001 to $20,000 segment had the second least amount of inventory at just under 100,000 units, followed by the $20,001 to $25,000 category at roughly 600,000 units.
With new vehicles prices elevated, more consumers are turning to the used market when their lease expires or when they need to replace their existing vehicle. This has resulted in higher demand for second-hand cars, trucks, crossovers and SUVs, driving up the average listing price. Many consumers are also eager to receive more money for their trade-ins due to the elevated new vehicle prices, forcing dealers to command higher prices for these used vehicles.
Both new and used vehicle prices are expected to remain elevated for the foreseeable future as automakers continue to grapple with the semiconductor chip shortages and other production setbacks related to the COVID-19 pandemic.