How to Determine If a Used Car Price is Fair?

Buying a used car is not that uncommon anymore. In recent years, the demand for used cars has increased in the automobile market. Instead of buying a new car, customers are more biased towards buying a good quality used car. But the main problem in trying to buy a used car is the price situation. So, knowing how to determine the fair price of used cars is very important.

Depending on the type of car and the customer, dealers often customize the price to get the best profit. Also, with the shift in the market, economy, and demand spectrum, the prices often vary. There are dealers and private sellers who try to sell used cars for the ultimate profit. Unlike new cars, used cars do not have a fixed invoice price, making the determination process of the fair price of used cars quite vague.

Fair Market Price for Used Cars

In most cases, the retail price for an ordinary used car is far from the true value of the car. New cars come with a factory invoice where a fixed price range is suggested by the manufacturer. The buyers know not to go above the MSRP. But when it comes to used cars, there are no such guidelines. No matter whether the seller is a dealership or a private seller, the selling price mostly works as a customer-perceived price.

The fair market price for a used car would be the value of the car as a driveable vehicle after excluding the depreciation costs. If a car works well and can perform almost as well as a new car, then it is of good quality and deserves a high price. Sometimes, some models have higher demand than others, which also makes the price of that type of vehicle move up. The trade-in value of a car also affects the used car price for the next buyer.

How to Determine the Fair Price for Used Cars?

A private-party buyer often looks for the best deals for the best quality cars. For someone who is going to use the car personally on a daily basis and has no expertise in fixing cars if something goes wrong, the main goal is to use the least about of money for the best car. But sometimes, people try to buy used cars that they intend to repair and redesign.

Research is Key

To determine the true worth of a used car, you need to do proper research. The main idea of the value of used cars comes from how much a buyer is willing to pay for a car. So, the trick is to check various sellers, like Kelley Blue Book and Zippy Cash for Cars, to see how much they are each asking for the same car. The average prices for the sale of similar cars could be the actual worth of the car.

Understand the Value of Different Cars

The private party value of a car depends on the buyer’s perspective. A person may be willing to pay a high price for a specific feature in a used car that another buyer might find useless. But, the car’s condition, make, model, age, and mileage impact the value of the car by a lot. The suggested price mentioned by the dealer of a used car always has room for negotiation. So knowing the possible value of the car helps in making good arguments during negotiations.

Check the Car’s Condition

The condition of the vehicle carries most of the price. A useless luxury car might only be worth the car’s scrap metal. But a well-running car with good mileage, a good quality engine, and a perfect vehicle history report goes a long way in fulfilling customer needs, thus making the price higher. A good deal always reflects the car’s condition.

Try Finding the Dealer Costs

Dealer cost of used cars refers to the expense made by the dealers in acquiring the car from private sellers or wholesale auctions, then the cost of various treatments and repairs are added to it. Dealer cash payments impact the price of the car directly. The price of the car becomes the combination of what the dealer paid for the car and what percentage of profits they want to make from the said car.

Places That Sell Used Cars at a Fair Price

There are a lot of well-known dealerships that offer to sell cars at a fair deal. Most car-selling franchises that sell new cars also have a section where they sell used cars that they acquire through buying or from trade-ins. These cars are then sold at a price that works for both the buyer and as well as the seller.

Among the dealerships, there are some online businesses that buy and sell used cars at great prices. In this world of technology, most dealers also maintain a website to make transactions online so that they can provide service all over the country. Among the most known sellers of used cars, some are:

Zippy Cash for Cars

This website offers to conduct the whole buying and selling process to be hassle-free. You can check the prices for the cars listed on this website and see what works for you.

CarMax

They are huge sellers who have proper shops and experts who check the quality of each car they buy and then sell. They are a safe bet when it comes to buying a used car.

AutoTrader

Like CarMax, AutoTrader is another very popular name. They promise to sell vehicles at a fair price so that anyone can come to buy a car from them without worrying about the price.

CarBrain

From across the country, CarBrain collects cars to sell. They do not try to scam customers, but you need to be smart in the negotiation stage to get the best possible deal from them.

Edmunds

More of a third-party buying and selling platform, Edmunds is a very reliable place to buy a used car. Among the vast inventory, you can choose the car you want, and also you have the choice of making an effortless and profitable deal.

Kelley Blue Book

Instead of buying a used car from private parties, KBB provides a more extensive choice range that helps in making the best decision. You can also choose the dealer you want to buy from too.

Craigslist

If you prefer to interact with individual sellers, then Craigslist and Facebook Marketplace is the best choice. Choosing the car you want, you can directly talk to the owner and come to an agreement regarding the price.

Why Should You Buy Used Cars?

If you think about it, buying a used car instead of a new car is almost always the best choice. In 2022, the price of used cars increased because of the supply crisis of new cars. At the start of 2023, it is predicted that the price will settle down with the increase in the new car inventory. Whatever it is in the coming years, it is a done deal that the demand for used cars will never cease to exist. Buying a used car has many perks:

• The used vehicles have already gone through the major depreciation process. So an almost new car works as well as the brand new one at half the price.
• You can save up some money to buy a used car with cash instead of financing a new car that you have to pay in installments for months to come.
• If you have some common knowledge about car pricing, you can easily negotiate the price of a car to get the best deal.
• Buying a CPO, as in a Certified Pre-Owned car, is the best of both worlds, with customizable warranty plans at the cost of a used car.
• Buying a used car gives you the choice and freedom to change out your car every few years.
• The practice of using used cars can easily help our environment by reducing production amount and thus by reducing emissions from factories.

Conclusion

If you can successfully determine the fair value of a used car before buying, then that can be a great transaction indeed. In most cases, the issue of buying used cars that almost all buyers bring up is the fact that most customers do not want to and even fail to structure a successful negotiation process. Because of this, a lot of people think that they will never get a good deal from a used car seller.

That is a true worry. But with the help of proper strategies and by using online platforms, it is possible to calculate the price of similar used cars. Even though these calculations are not accurate, they help the buyer get an idea about the possible price of the car they want to buy. With this knowledge, the buyers have a better chance when it comes to driving down the prices during the negotiations.