Since the recession has ended, the average price of a used car was soared due limited supply. But The Detroit News says with more vehicles coming in due to leases coming to an end, prices are beginning to fall. According to CNW Research, the average transaction price of a used car in September was $10,963. Compared to the same time last year, the average has dropped 2.1 percent.
"During the recession, it almost cost as much to get a used car as it did to get a new car, but now the market is going back to historical norms and it's going to be better every month. From 2008 to 2012, there was a significant growth in the number of leased cars and now they're all coming back to the market. As supply is increasing, auction values are dropping ... making used cars more affordable," said Larry Dominique, vice president of TrueCar.
Used car supplies are on the rise as well, with 9.76 million vehicles sitting on used lots in September. That's an increase of 1.5 percent when compared to the same time last year.
But there are downsides to increase in used car supplies. Analysts say the increase of supplies means it will be harder for dealers to move vehicles. Also expect an increase in lease rates.
Source: The Detroit News