It’s no secret that the used car market is absolutely bananas right now, with soaring demand and high prices that may be shocking to those buyers reentering the market for the first time in five years. Although used car prices are now starting to level out, they’re still elevated from last year. As a result, finding a good used car under $20,000 is still quite difficult, per a recent study.
According to Edmunds’ recent Q1 2023 Used Vehicle Report, which is based on data collected by Edmunds, the average used vehicle transaction price during Q1 of 2023 fell 6.4 percent year-over-year, dropping to $28,381 versus $30,329 during Q1 of 2022. Nevertheless, vehicle prices remain at historically high levels, with the Q1 2023 figure up 44 percent compared to the average used vehicle transaction price recorded for Q1 of 2018 ($19,657).
According to the data, 30.6 percent of used cars sold during Q1 of 2023 were priced under $20,000, a significant decline from 60.5 percent recorded five years ago. Edmunds also reports that less than 1 percent of new vehicles sold in Q1 of 2023 were priced under $20,000.
Used vehicle supplies have also declined significantly over the course of the last five years, with leased vehicle volume dropping to 559,000 vehicles from 1 million vehicles in Q1 of 2018. Trade-in volume was down to 5.5 million vehicles in 2022, as compared to 6.2 million vehicles in 2018, while off-rental vehicles are now older and more expensive, with the average off-rental vehicle age recorded at 3.0 years in March of 2023, as compared to 1.9 years in 2019, and average pricing set at $28,916, as compared to $15,829 in 2019.
Edmunds says that while average used vehicle prices have decreased slightly, shoppers are still facing significant challenges. However, due to a dramatic increase in used vehicle prices, those who have opted to keep their vehicle for the last five years have “virtually driven for free,” with the higher prices offsetting higher mileage.
To note, the 2024 Chevy Trax is among the most-affordable new vehicles in the U.S., starting at only $21,495, including DFC.
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Comments
It’s generally financially smart to buy used. Now is not such a time.
Maybe for some, I prefer to purchase new with incentives then I typically keep them for 10 years. This has worked very well for me. The exception would be if I could purchase a good used vehicle from family or friend that I knew well and had a solid history. I would never purchase a used car from a dealership, too expensive and too many come from the auction with covered up problems which is why they went to the auction in the first place. I prefer not to buy someone else’s problems. Save up your money and wait for a deal. Too many people make car buying an emotional decision rather than a business decision, which is what the dealership is hoping for.
I guess it all depends on one’s definition of “good.” A quick search turned up plenty of cars within a 100 mile radius under $5k. Are they “good”? Maybe. As a wise old man once told me, “lower your standards and have a good time!” Who’s to say $20k is the benchmark? Why not $30k…or $10k? Point is, there’s a price point for everyone out there….you just might have to look a little harder these days
Find a “cheap” used car and the repairs will never stop. Good luck. The smart play is buy new and cheap. Hello 2024 Trax.
That’s what we did, 2024 Blue Glow LT nearly loaded Trax and couldn’t be happier. Drives great, lots of tech, great mileage all for a out-the-door price of ~$24K thanks to GM card and other discounts.
I can’t seem to sell a 2012 Chevy Sonic LX 5-speed with 28,535 actual miles. New tires, perfect interior, never smoked in, perfect red exterior, run exclusively on full synthetic oil. Full maintenance record. Runs perfectly. Was asking $7,000. What up with that?
Where are you located?
Astoria, S.D. 90 miles north of Sioux Falls.
605-592-1971. Price is firm. Thanks.
Thanks for the reply Wayne, I think the price is good, but South Dakota is too far from me to make it worthwhile having a look, but good luck with the sale, sounds like a bargain in this day and age!