In the aftermath of the Great Recession, U.S. auto sales took a nose dive, but over the past several years, numbers have increased dramatically--as have prices. The one-two punch of high demand and high prices has forced many new-car fans to shop for used cars instead.
Generally speaking, the secondhand market hasn't been much kinder to consumers, but finally, things are looking up--or down, rather. J.D. Power analysts say that used car prices have begun to fall for the first time since 2008.
The firm says that prices began to dip last year: in 2016, on average, used vehicles cost four percent less than they did in 2015.
As for why the prices have begun to fall, the reason for that is pretty straightforward: during the Recession, the supply of used cars dwindled, as wary owners held onto their vehicles for longer. Today, many of those owners have purchased new rides, resulting in a small glut of used cars. (A growing number of formerly leased vehicles is improving used-car supply, too.)
That said, not every used car can be bought on the cheap. According to Power, the prices of midsize vans and large SUVs remained flat in 2016. In-demand vehicles--especially trucks and crossovers--are likely to see smaller price fluctuations than other segments.
However, if you're in the market for a small car, you could be in real luck. Smaller vehicles remain unpopular with consumers, thanks in part to low gas prices; taking advantage of the softer demand for small cars could result in big savings.
Not quite ready to sign on the dotted line? Don't worry: Power says that prices should continue to slide for another year or two.