Compounded by the credit crisis, a difficult recession, rising oil prices, and a "cash for clunkers" economic stimulus program that turned 700,000 used cars into cubes, the United States experienced quite an abnormal spike in the value of used cars in the past couple of years.
However, as gas prices are showing signs of easing and more people are looking towards the purchase of a new car, the prices for used cars are expected to fall.
According to the National Automobile Dealers Association (NADA), used vehicle prices are expected to fall by 2 percent next month for used passenger cars and 1 percent for used trucks. In fact, more fuel efficient cars will see the largest price drop of all thanks to falling gas prices resulting to lowered demand.
As evident of a 2009 Toyota Camry, average street prices have risen 15 percent from January to May, averaging $13,235. NADA projects the price to fall by 5 percent, returning back to a cheaper $12,560.
Despite the drop, used vehicle prices will continue to remain relatively high by historical standards.
However, according to LA Times, falling used car prices are double edged swords. Those in the market will enjoy the bargain hunting experience. However, those looking to trade in their older vehicle at better incentives for a new car will have a more difficult time.
Nonetheless, the auto industry is expected to sell 14.3 million vehicles this year as new car demand continues to grow.
