If you’ve been on the market for a car any time in the last two years, you’ve probably experienced some sort of sticker shock.
Prices for new and used cars have skyrocketed due to supply-chain issues — primarily an ongoing shortage of computer chips — but just how much more are consumers paying for cars?
According to a June 30th snapshot of prices in the “Return to Normal” index released by CoPilot, consumers are paying an average of $10,046 more, which is 43%, than if typical depreciation expectations for used cars were in play.
The report revealed that the average price tag for a used vehicle is $33,341, a 0.5% increase from May. If depreciation forecasts had held true, the average price would be $23,295.
But the price does depend on a variety of factors, most notably the age of the car. Nearly new vehicles that are 1 to 3 years old have an average listing price of $42,314, which is 45% more than the projected amount. By contrast, vehicles that are 8 to 13 years old come with an average price of $18,038.
For buyers, having a vehicle to trade-in is their best bet for negotiating the best price on a new or used car right now. According to a joint report from J.D. Power and LMC Automotive, the average trade-in equity is estimated at $10,381, a 49.2% increase from a year ago, and the first time that figure has been over $10,000.
Related: Should I Buy or Lease My Next Car?
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