Why Used Cars Are About To Get Much Cheaper
Washington DC April 28, 2014; The AIADA newsletter reported that according to statistics from used-car auction giant Manheim, about 1.7 million vehicles came to the end of their leases and entered the used-car market last year. That's a low number, and short supplies have kept used-car prices high.
But, reports Business Insider, that number has already started rising — and that means used-car prices could be coming down soon.
About a quarter of new vehicles were leased last year. Most of those will hit the used-car market when their leases are up, making their way through an auction network, like Manheim, to dealers around the country.
But back in 2010 and 2011, fewer new cars were sold at all, because many consumers were still recovering from the recession. And a smaller percentage of the cars that were sold were leased, because lenders were still being stingy in the wake of the banking crisis. Leases made up just 19 percent of retail new-vehicle sales in 2010, and 20 percent in 2011.
These are the cars that have been coming on to the market during the last year or so. It's why supplies have been tight, and used-car prices have been high.
For more on the state of the used vehicle market, click here.