Tightening supply and surging demand have pushed car prices, new and used, through the roof.
Used car market heats up — way up
A shortage of new cars has pushed consumers toward used cars over the past few months, creating a scorching hot used car market.
Used car prices were up 10.5% in June 2021, the largest one-month jump on record, and 45.2% over the last 12 months. The average price for a used car hit $26,500 in June, according to Edmunds.
But there are signs the used car rush is slowing. Used car inventories seem to have bottomed in April and prices probably peaked in June 2021, according to the Goldman Sachs report. Prices will likely retrace about 35% of their growth since the start of the pandemic by the end of this year and over 70% by the end of 2022.
A separate Cox Automotive report showed that the retail price of used cars, the price customers pay, has increased, but at a slower pace over the past month.