Used cars may never be cheap again — here's what you need to know about shopping for one right now
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- Do your research before you start haggling.
- Rental fleets can be a good alternative to apps like Carvana.
- Check on warranties before buying.
With prices of new cars skyrocketing, more car shoppers are heading to the used lot.
Shopping used or certified pre-owned can allow you to get a relatively new car for much cheaper than on the new lot. The average price paid for a used car in recent months has hovered around $27,000, while the average price of a new car has been up around $46,000.
If you've already looked into leasing instead and decided that's not for you, buying a used car can be a thrifty option for someone who needs a new set of wheels right now.
But buying used doesn't always mean you're getting a better deal. Sometimes shopping used can require even more research and preparation than shopping for a new car. Before you hit the lot or start scrolling through Carvana, you should arm yourself with a few key pieces of information.
Do your research
There are so many factors to keep in mind when shopping for a used car that it can be helpful to narrow your search early on and hone in on one particular brand, make, or model.
One of the biggest advantages of shopping for a used car is that there is ample information about how the brand and model you're considering has fared on the road so far.
Important things to look up include recalls, reliability, and resale values, among other things. Some specific model years can have their own unique problems, like a slippery transmission or glitchy infotainment systems that are remedied in a later model year.
Know the car's value going in
Once you've decided on a model or brand, your next Google search should be for the Kelley Blue Book value. Used car prices have been notoriously volatile since the pandemic and squeezes on inventory have allowed sellers of used cars to jack up prices based on urgent needs.
That's why it's so important to know the going rate for a car before you start negotiating. You might still end up paying more than the KBB value based on the used market at the moment you're shopping, but you will know where negotiations should begin.
Check rental fleets
Car-rental companies can be a great source for gently used car purchases. Companies like Hertz and Avis turn over their fleets very quickly to keep up with customer needs so you can often find newer model years at a Hertz, Avis, or Enterprise used lot.
In addition to being newer used models, you can feel confident about how the vehicles were maintained when they were in a rental fleet. Car-rental companies meticulously maintain their fleets to avoid bad experiences for their customers. These companies are also required to address all open recalls when a vehicle is in their fleet.
Shopping the Avis, Hertz, or Enterprise website can be a good alternative to apps like Carvana, which have caused problems for some shoppers. The rental car companies often offer similar advantages to apps, including no-haggle pricing and searching a large swath of inventory based on your needs.
One thing to keep an eye out for in the rental fleets is the mileage. These cars are pretty constantly in use for the time they spend in the rental fleet, meaning that they rack up a lot of miles in a short period of time.
More tips and tricks
If you can, you should avoid leasing a used car. While this option can be great for new car shopping if you're on a budget, used car leases can be dangerous. If the vehicle is no longer under factory warranty, you will be on the hook for all maintenance and repair costs.
That means if something catastrophic happens, you're responsible for paying to keep the car running until the end of the lease.
Even when buying a used car, warranties are an important part of used car shopping. If you can, try to find a used or certified pre-owned vehicle that is still under warranty. This can help with maintenance and repair costs early on as you start to better understand the wear and tear on the used car you have acquired. If repair costs are a concern for you, consider purchasing an extended warranty on your used car.
Most car salespeople will also tell you to avoid individual sellers where you can, and shop for certified pre-owned (the used lot at a dealership typically has CPO vehicles). The reason for this is that the vehicle has been through a rigorous, certified inspection process and you can be more sure about the longevity of the car.
That doesn't mean you shouldn't check places like Carvana or Craigslist. Sometimes you'll stumble on a great find, or you can use your market information to arm yourself once you head to a used car dealership.
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