Take pent-up demand for new vehicles, a reopening economy, and a chip shortage that’s curtailing new-car production, and therefore supply, and any economist will tell you that combination will lead to higher automobile prices. Add irrational consumer behavior — is there any other kind? — and you get headlines like the recent one where nearly half of surveyed buyers said they were willing to spend $5,000 over list price to get a new car. (Likely, these are the same people who were panic-hoarding toilet paper a year ago.)
The spillover effect has been an upswing in prices for late-model used vehicles. That’s not typically how things work: A 2018 Chevy Silverado should be worth about as much today as a 2017 Silverado was a year ago. Instead, it’s worth about 27% more. This, according to data gathered by iseecars.com, a website that aggregates listings of used and new cars for sale and analyzes average transaction prices.
Some models are seeing greater increases than others, though. The iseecars.com survey shows 1- to 5-year-old examples of the following vehicles all at least 25% more expensive than a year ago: the Silverado/GMC Sierra 1500, the Ram 1500 and the Toyota Tundra, the Mercedes-Benz S-Class, the Chevy Camaro, the Mitsubishi Mirage, and the Range Rover Sport. The Chevy Corvette and the Mercedes-Benz G-Class have seen their prices surge by 33%.
Beyond the full-size pickups, that’s a pretty weird mix. You have a couple of luxury vehicles and a couple of sporty cars, but the biggest head-scratcher has to be the sudden interest in the Mitsubishi Mirage. Certainly, if you’re living unhappily with a Mirage you purchased not long ago, now’s the time to sell.
In fact, it’s a good time to sell or trade-in any of those vehicles. But what if you’re looking to buy? The following cars have not seen a big run-up in prices, all increasing by less than half of the 17% overall average: Subaru Crosstrek and Impreza, Toyota Prius, Mazda CX-3, and Honda HR-V, as well as the Mercedes-Benz GLC, Audi Q7, Volvo XC90. The BMW i3 and Tesla Model S have seen no increase in price, with values of the Model S actually declining slightly, likely due to competition from the Model 3 and Model Y. The sudden increase in EV models and the attendant rise in EV range quickens the value erosion of used EVs.
Used cars, always a bit of a gamble, have now become a part of America’s casino economy. Sell high, buy low. But don’t panic. It doesn’t make sense to pay nearly $150k for a used G-Class that could have been purchased for $37,000 less last year. But if you absolutely must have a used G-Class right this minute, at least see if the seller will throw in a few mega-packs of TP.