COVID-19 may have dramatically altered life over the last 20 months, but it has not stopped people from buying cars. The pandemic has changed the car buying landscape, though. Production shutdowns have led to fewer newer vehicles rolling off the assembly line. Meanwhile, demand for less expensive used cars has never been higher. It all makes for a very intriguing scenario to anyone who is in the market for a car.
Any plans you might have to purchase a used car should be tempered with the understanding that inventory is low and prices are high. You will have to be more careful now than you were pre-COVID. The good news is that quality used cars are out there. You just have to be willing to hunt for them.
Car Fast Cash is a California company that pays cash for cars in San Bernardino County, San Diego County, and elsewhere. In their many years of operation, they have learned just about everything there is to know about buying and selling used cars. They recommend the following tips for post-COVID used car buying:
1. Determine What You Can Afford
The starting point for any used car hunt is determining what you can afford. There is no point in wasting time on cars outside your budget. In addition, buying a car you cannot afford only increases the risk of repossession and a blemish on your credit report. Stay within your budget and you will be much better off.
There are couple of things to know on this point. First, avoid the trap of maxing out your budget. Settle on a comfortable number that gives you a little bit of wiggle room should you run into temporary financial setbacks. Second, consider the total cost of ownership when you are figuring out your budget.
Total cost of ownership includes the following:
- The purchase price
- Annual insurance premiums
- Routine maintenance costs
- Weekly fuel costs.
It is one thing to say that you can afford the monthly payments on a car loan. But can you afford everything else along with those monthly payments? Consider total cost of ownership in the right way to determine what you can truly afford.
2. Research Multiple Brands
You may have your heart set on a particular make and model. You may be especially loyal to a particular brand. But in today’s market, with used car prices being so high, it is a good idea to research multiple brands. The goal is to find cars that are comparable in class, size, reliability, etc.
For example, you might look at comparable SUVs from Kia, Ford, Mazda, and Chevrolet. Even though your preferred manufacturer is Chevy, will you get comparable quality at a lower price from another brand? This is something you have to seriously consider. You might not be able to find your preferred brand. And even if you do, high demand could put it out of your reach financially.
3. Use an Online Valuation Tool
Once you have an idea of the makes and models that you are willing to look at, take advantage of an online valuation tool. A good tool from an organization like Edmunds or Kelley Blue Book can tell you a lot. For starters, it can tell you what the makes and models you are interested in typically sell for. They can even pinpoint sale prices in your local area.
Some online tools can point you to dealerships with inventory you might be interested in. Others include listings from private buyers. The thing to remember about online valuation tools is this: you are not going to use them just once.
Use a valuation tool to know what prices you should be looking at before you start shopping. Once you find a car you like, use the tool to value it. You will be able to enter mileage, general condition, extra features, etc. That way, you’ll get a more accurate price on that particular car instead of a general price on all cars of that make and model.
4. Ask for Vehicle History Report
Vehicle history reports are a comparatively modern tool made possible by the internet. You may not be able to get one if purchasing from a private seller. But if you are working with a dealer, do not be afraid to ask for the report. Any dealer should be able to provide one without issue.
A vehicle history report can reveal important things you otherwise would not know about the car in question. It lists things like recalls and major repairs. It might list accident damage reported by an insurance company or repair shop. A vehicle history report could save you from a buying mistake you would regret later on.
5. Inspect and Test Drive
It is a good idea to have a used car inspected before you purchase it. Most states give potential buyers the legal right to have a car looked over by a mechanic of their choosing. If a seller balks at that suggestion, walk away. It’s just not wise to buy a used car without first inspecting its engine, frame, suspension, and so forth.
Along with inspection, do not be afraid to ask for a test drive. Dealers will almost always accommodate such requests. Private sellers, not so much. If a private seller does agree to a test drive, there is a good chance they are not trying to hide anything.
6. Don’t Be Afraid to Negotiate
Last but not least, don’t be afraid to negotiate – especially if you are purchasing from a dealer. Most used-car sellers understand that a car’s list price is just a starting point for negotiations. Sellers expect to have to dicker. Force them to live up to that expectation.
Even as COVID restrictions ease, car inventories remain surprisingly tight. Prices on used cars will continue to be high until inventory problems are solved. As a used car buyer, that means you have to be extra diligent about protecting your own interests. Use the tips from this post when you buy your next used car.