As the average price of a new car rapidly approaches $50,000, it shouldn’t be surprising that used car prices are shooting up as well. Data from Kelley Blue Book shows that the average used car in December sold for $28,205. That would be 28% higher than it was in December 2020 and 42% higher than the year prior.
As KBB points out, a significant reason for these higher prices is the dwindling selection of cheaper used cars. For those priced less than $10,000, there is less than 39 days supply. Those that cost between $10,000 and $25,000 have a supply of between 46 and 48 days, while those higher than $25,000 had more than 50 days supply.
The volume of those above $25,000 is clearly quite high as the overall used car days of inventory in December was 51 days. Of note, however, is that’s the first time since January 2021 that the average was higher than 50 days. In December 2019, it was 76.
A report by Automotive News has indicated that this current used vehicle price boom will end later this year and early 2023. Specifically prices are predicted to fall by about 20% to 30% in a return to a normal relationship to new car prices. This is contingent on new car supply increasing, which data firm KPMG estimates will occur at the end of this year.
How to prepare to sell your used car:
