Supply issues stemming from the COVID-19 pandemic have drastically affected demand — and the prices — for both new and used vehicles.
Things are improving: The average used car price at the end of March 2022 was $27,246, the third straight month of decline and $1,000 lower than it was in December, according to a Kelley Blue Book news release.
But prices are still 28% higher than a year ago, the news release notes.
Given the state of the marketplace, what does money expert Clark Howard recommend if you have lost access to a car that you really need?
What Should You Do if You Need a Car Right Now?
Because of the still-inflated prices, Clark recommends that you do one of two things.
Repair Your Current Vehicle
If you can, try to delay buying a car right now. To tide you over, see if you can make the necessary repairs to your current vehicle to keep it on the road.
And once you’ve got it running again, here’s a simple maintenance list to follow to help keep it running.
If keeping your current vehicle on the road is not a possibility, here’s what Clark suggests.
Buy an Older Vehicle
For the best value, Clark typically recommends that you buy a used vehicle that is around three years old. But because the car market is so crazy right now, that wouldn’t be financially wise. Instead, buy something a bit older to get you from Point A to Point B.
“You can just buy something older and use it as a placeholder until prices and supplies become more in sync,” Clark says. “Then later … you’ll be making a second purchase. That’s the only good strategy.”
How To Choose a Used Car Right Now
When it comes to buying a used vehicle. remember to comparison shop to find the best deal.
Stay Within Your Budget
Don’t wreck your budget for a used car right now. You might not be able to get a vehicle with all the bells and whistles you desire, but the point right now is just to get something that will tide you over until the auto market improves. Set a budget.
When it comes to pricing, keep in mind these points:
- Try to come in under budget or right on it – but definitely not over.
- Dealers typically have some wiggle room on price and may lower it, but you have to bargain with them.
- Know the difference between sticker price and total price (which includes taxes and fees).
Get the Vehicle Checked Out First
As reputable as the seller may be, Clark always suggests that you get your car examined by a licensed mechanic who is independent of the dealer.
- Ask people you know if they have a mechanic they would recommend.
- Make sure the mechanic has an ASE (Automotive Service Excellence) certification, which means he or she has undergone proper training.
“The mechanic’s not going to catch everything,” Clark says. “They may miss something, but you will avoid so many problems.”
This is especially important when you’re buying an older car.
“Buy a very old vehicle to nurse you through the months until the vehicle market gets back into some form of equilibrium,” Clark says. “And that will happen in 2022 as the automakers, one by one, seem to be getting better at dealing with the supply chain issues.”