I would say that the best time to buy a used car is right NOW! Here’s why:
- In 2020-2021 the all-time record $ 11.7 trillion QE cash liquidity was injected into the World economy to ease the pandemics shocks with 70% of it - in the US. The rapid growth of the money supply, along with a decrease in the production of goods and services, caused robust price inflation, only partially mitigated by financial markets. In April 2021, inflation in the United States accelerated to 4.2% in annual terms, breaking the record of 2008. In May 2021, it sped up to 5 %, in June – to 5.4%. Consumer demand for car purchasing is as high as it has never been before.
- New car supply shortages hit dealerships across the board. During the early pandemics, car manufacturers canceled their orders for microchips, and by early 2021 they ran out of supply. The car manufacturing industry basically stalled, and right now, very few models are being manufactured and supplied to dealers. It couldn’t be fixed fast because microchip producers cut their capacities for 2021.
- As a result, new car prices sky-rocketed from January to June 15-25%. А variety of consumers want to buy a car, but vehicle availability on the market is severely limited.
- The shortage of new cars has also dramatically increased prices of used cars, which have gone up across the board, now selling at an all time high.
Some people believe that it’s not a good time now to buy a used car because of high prices, very few discounts and incentives available. They believe that the microchip shortage will be quickly restored, and after that car prices will go back down to “normal” levels. I think they’re wrong. First, because of the uncertainty of Covid-19 waves and economic instability they cause. This time it was microchips, next time, it will be some ball bearings, who knows. Second, because of the 8 trillion dollars in cash that has been poured on the US population in 2020-2021. The used car prices have gone up, and they will be even higher, with no return to old levels.
Regardless of the extraordinary situation that I wrote above, there are useful tips on how to get the best timing and buy a used car for the best possible price. Prices may go up or down but using these tips will help you to get the lowest possible price at the time of the deal.
What is the best time of the year to buy a used car
Keep in mind that it’s a highly seasonal business. Prices, supply, and demand vary from season to season.
Usually, the tax season is one busting used car prices to maximum levels. People get their tax money back and want to spend it right away. So the prices are going up 4-7% from the winter season because of so much demand and limited supply. It’s the worst time to buy a used car.
Late fall and winter are the best time of the year to buy a used car. It’s a slow time, so you’ll get more attention from a sales representative. Especially when it’s freezing outside and there is not a single customer spotted at the dealer's lot through the falling snow.
Some car categories like sports cars, roadsters, and convertibles get especially deep price cuts during the winter season. And on the contrary, these cars’ prices max out from April through July, so it’s not a good idea to shop for them in the summer season.
What is the best month to buy a used car?
Dealerships’ managers and owners often have quarterly goals and incentives they want to meet in order to get their bonuses. Therefore, the end of the month in March, June, September, and December is a kind of magical time when not only salespeople hustle around customers to hit their monthly sales numbers but also their superiors are trying to pay special attention to every person calling or walking in and engineer attractive deals for them. Out of these four, December is really the king and the best month to buy a used car. Surely lots of dreams of buying a perfect used car or truck will come true at the end of the quarter.
What is the best day to buy a car
The slowest days of the week are Monday and Tuesday, especially Monday mornings. So, unlike Garfield, the cat who doesn’t do mornings, the best time in the week to shop for used cars is Monday morning. The worst - is the busy Saturday afternoon. Try to go to a dealership when salespeople and managers are not as busy so they have the opportunity to take a breath and can treat your preferences by showing an individual approach.
There are “superpowered” magic days like Monday or Tuesday which are at the same time standing at the end of the month, end of the quarter, and end of the year! In 2021 it’s going to be December, 27 and 28th. During these days, all the prices cut, discount, and sales incentive forces are compounding their powers, really driving prices down, which could make your wildest used car or truck dreams come into reality.
What are the best holidays to buy a car
Get yourself a merry discounted used car for Christmas! Indeed the average discount off dealer’s sticker price gets up to 11,5-14% at the end of December, right after Christmas day. It’s the highest average discount for the entire year. Change of year is perceived as losing value in the customers’ eyes with the year number changing to new but the car year model getting older. Therefore the dealerships are trying their best to maximize car sales and get rid of excess inventory.
Black Friday in 2021 is on November 26th. It could really get huge with special incentives, gifts, and cashbacks, car dealerships offer to people who want to buy a vehicle on the spot and drive it off the lot the same day. The average discount used car dealerships would make for the Thanksgiving season is around 9,5-10% off the sticker price. But for Black Friday, they could give you some extra! So, be attentive to information releases on our website, Facebook and Instagram.
Best time to buy a used truck
In general, used truck sales discounts and incentives are following those for cars. But the trends are more volatile, with prices going way up in summertime during high construction and agricultural season and coming back down in winter. A lot of people buy pickup trucks to use for work in construction, farming, and other types of a seasonal business.
Due to microchip, rubber, and special plastics shortages, truck prices for high season 2021 went up all-time high above MRP. Truck manufacturers are storing partially-assembled trucks out in the fields under open skies since they ran out of storing space. So, probably now it’s the best time to buy a used truck manufactured in quiet pre-covid times because nobody knows how much longer new trucks pre-manufactured January through June 2021 will have to spend out in the field before they will be finally equipped with a microchip, rubber and whatever else parts they miss now. The quality of those trucks will hurt big time with a “lot rust”, flat spots on tires, and water leak damages.
Best time to buy CPO car
There are two major sources CPO cars are coming from:
- certified pre-owned cars from private owners who purchased them new and serviced them at the same dealership
- formerly leased vehicles turned back into a dealer and certified to be sold as CPO
If we take a look at the timing of this all going on, the volume of trade-ins either of pre-owned or formerly leased vehicles is growing towards the end of the year, August through December. It takes anywhere from 2 to 5 weeks to get a vehicle into the repair shop, inspect, fix and tune it up. That means the quantity of CPO vehicles for sale is minimum during the spring and early summer months and maxing out January through February (since many lease contracts end December 31th). So, it’s the best time to shop for CPO cars. You’ll get maximum variety to choose from and the lowest prices since these months are slow.
Other good and bad times to buy a car
Pay attention to “the lot time”. This is an exposure time for a vehicle from the moment it was first introduced for sale to the present. Keep in mind that the first couple of weeks of the lot time, all car dealers want to take the cream of the crop moneywise so that car may be marked up $2500-4000 higher than an average fair price. After 90 days of the lot exposure, things are starting to get better for you as the dealer wants to keep just a wholesale margin on it. From 90 to 180 days, the price is going way south from averages. Yeah, it’s cheap, but there’s a question why nobody wants to buy it. Every extra day on the dealer’s lot is extra money out of the dealer’s pocket. So depending on how long is the lot time for the vehicle you may ask for an extra price off. But how to find out the actual “lot time”? The simplest and classic way is just to spot a few vehicles you like on a dealer’s lot and see if any of them are still there after 14, 90, or 180 days. Another option is to track selected vehicles through a dealer’s website. You may also write down the VIN number and check the car history.
Frequently Asked Questions about when is the best time to buy used cars
Is December a good time to buy a used car?
Yes. December, and especially the week following Christmas, is the best time of the year to buy a used car.
- You get a maximum of 11,5-14% average discount off the dealer’s sticker price.
- “Superpowered” discount days - last Monday and Tuesday of the year, which are at the same time standing at the end of the month, end of the quarter, and end of the year. During these days, salespeople and management are trying their hardest to meet annual, quarterly, and monthly sales goal incentives.
- Change of year is perceived as losing value in the eyes of customers with the year number changing to new but the car year model getting older. Therefore the dealerships are trying their best to maximize car sales and get rid of excess inventory.
Is January a good month to buy a used car?
January is not as good as December, but it’s still a good time to buy a used car.
- It’s the slowest month of the year, so salespeople can treat your preferences by showing an individual approach.
- The best time to shop for CPO cars. You’ll get the maximum variety to choose from and the lowest prices.
What are the best holidays to buy a used car on?
By all means, Christmas is the best holiday season to buy a used car. The average discount off dealer’s sticker price gets maximum at the end of December, right after Christmas day. Christmas and post-Christmas season shows the highest total discounts off the regular price for the entire year. The salespeople and management are highly motivated to meet their annual sales goals.
When do used car prices drop?
When a vehicle is first offered for sale, a dealer marks it up to $2500-4000 higher than an average fair price. If it couldn’t sell for 15-30 days, a dealer first marks it down 40-50% to $1200-2000, and after 90 days, writes off another 40-50% agreeing to keep just a wholesale margin on it. At 120 days lot exposure, the price often goes below the average, and a dealer decides whether to continue offering it retail or sell it at an auction.