Luxury car buyers are facing such high used-car prices that more are making the jump to buying new, reports Bloomberg. In some cases, it’s actually more expensive to buy a used luxury car than a new one.
“BMW AG's 2011 3-Series compacts and M3 sedans now cost $34 more a month than one-year-old used models, according to Edmunds.com,” writes Automotive News. “General Motors Co.'s Chevrolet Corvette is about $12 a month cheaper to buy new than used, the auto-pricing Web site says.”
Economists believe that this price jump is caused by a combination of lower used-car supplies, higher new-car inventories and aggressive new-vehicle pricing. This drives the price of used cars higher and the price of new cars lower.
Kelley Blue Book predicts that this phenomenon likely won’t change anytime soon. “It will take several years of strong new-car sales to replenish the shortage of used vehicles driving values up today,” writes the vehicle valuation website.
If you’re in the market for a new car, this news could mean one of two things for you. On the plus side, buying a new car may be easier to achieve using the same budget you were going to spend for a used car, and you’ll get the full factory warranty to boot. But the downside is that shoppers looking for a dirt-cheap used car may be out of luck for the next few years. The growing market for used cars is driving prices up, so it will be harder to find the same great deals on pre-owned vehicles.
In any case, your best bet is to shop around and compare prices. Resources like our used car listings, eBay motors and Autotrader.com will help you find the best deal in your area. Plus, don’t forget that financing can making a big difference in the overall cost of your car. Shopping around for the best interest rate could save you thousands over the course of your loan.
In the market for a used or new car? Check out the U.S. News rankings of this year's best cars. Then, look for a great deal on a new car by checking out this month’s best car deals. Also, be sure to follow us on Twitter.