Report: Vehicle trade-in values are spiking during COVID-19
Experts say car owners could be sitting on thousands of dollars in extra cash due to increased demand in the used market.
SANTA MONICA, Calif., Aug. 18, 2020 /PRNewswire/ — Consumers considering selling or trading in their vehicle in the near future might want to pull the trigger now, according to the car shopping experts at Edmunds.
As a follow-up to recent research released by Edmunds about used vehicle retail prices rising during the coronavirus pandemic, Edmunds analysts say that used vehicle trade-in values are also increasing dramatically.
Edmunds data reveals that the average value for all vehicles traded in during the month of July climbed to $14,066 compared to $12,083 in June, marking a 16.4% increase that is just shy of $2,000.
Our analysts note that limited new vehicle inventory and a surge in demand for used vehicles are driving values up: Edmunds data reveals that the average days to turn (DTT) for used vehicles dropped to 38.3 days in July compared to 44.1 days in June. This 13.1% decrease is the steepest month-over-month drop that Edmunds has on record.
Car-buying platform Edmunds.com serves nearly 20 million visitors each month. With Edmunds.com Price Promise(R), shoppers can buy smarter with instant, upfront prices for cars and trucks currently for sale at over 10,000 dealer franchises across the U.S.
“The used market is experiencing a dramatic recovery: Used vehicles were sitting almost untouched at the start of the pandemic, and now they’re practically flying off dealer lots,” said Jessica Caldwell, Edmunds’ executive director of insights. “Dealers are willing to pay more to acquire inventory to meet the surge in demand for used cars, which is great news for car owners because it means they can expect to get a higher value for their vehicle if they sell or trade right now. But time is of the essence because there’s no guarantee that these unique market conditions will continue for long.”
To help car shoppers who are looking to take advantage of this seller’s market, Edmunds experts created an insider guide on how to appraise and sell your vehicle safely during the pandemic:
Do your research and know how much your vehicle is worth. Whether you’re planning on selling to a private party or trading in your vehicle as part of your next purchase, you’ll first need to find out what the car is worth. The good news is you can quickly appraise your vehicle on third-party sites including Edmunds.
It is important to accurately take into account all the car’s options and be honest about the condition. On the results page, you’ll want to focus on the trade-in value number. This is roughly what you can expect a dealership to offer you.
Get an offer for your vehicle. Call the used-car manager at your local dealership to set up an appointment for an appraisal on your vehicle and ask about social distancing measures and other precautions that will be taken to ensure your safety. Or more conveniently, you can get an instant cash offer for your vehicle from a site such as Edmunds.
No personal information is required: All you need to do is enter the details on your vehicle and you’ll get an instant redeemable offer good for seven days. You can use this offer as a baseline for your asking price. Or if you’re comfortable with the offer, you can accept it.
Negotiate or close the deal. Once you have firm offers, you have a couple of options. You can either accept one of the offers or negotiate for a better price at the dealership (offers on Edmunds aren’t negotiable).
If you’re comfortable with the offer on Edmunds and would like to expedite the selling process, consider selling through the site. But if you are upside down on your car and need to fold the loan balance into your next car’s financing, the dealership is probably the best place to do so.
“Knowing how much your current vehicle is worth is arguably as important as the price you’re considering paying for your next vehicle, but it’s often overlooked by consumers,” said Ivan Drury, Edmunds’ senior manager of insights.
“Vehicle values are highly dependent on individual models, mileage, condition, and local market dynamics so the worst thing you could do right now is assume how much your car is worth, especially if you own an older or higher-mileage vehicle. Even if you’re not immediately planning on buying a new car, it doesn’t hurt to take a few minutes to get your vehicle appraised online. You might be pleasantly surprised at the extra cash sitting in your driveway.”
For more automotive research and insights, visit the Edmunds Industry Center here: https://www.edmunds.com/industry/insights/.
Edmunds guides car shoppers online from research to purchase. With in-depth reviews of every new vehicle, shopping tips from an in-house team of experts, plus a wealth of consumer and automotive market insights, Edmunds helps millions of shoppers each month select, price and buy a car with confidence. Regarded as one of America’s best workplaces by Fortune and Great Place to Work, Edmunds is based in Santa Monica, California, and has a satellite office in Detroit, Michigan. Follow us on Twitter, Facebook and Instagram.