POSTED: Monday, October 10, 2011 - 3:24pm
UPDATED: Monday, October 10, 2011 - 4:15pm
EL PASO- For a majority of the year, prices of used cars have actually been increasing, but are slowing starting to decline.
The spike was due to shortages in new cars after the devastating earthquake in japan and economic uncertainty, but now, used car prices have started falling. Insiders in the used car business have picked up on the trend of falling prices.
“Not a huge drop, but a significant drop. I'm sure as the year progresses, we'll start to see more and more drops in the prices,” says John Shamaley, Thrifty Car Sales.
This spring, shortages of good used cars left dealers scrambling for inventory.
“There were less used cars at the auction. So you have the same dealers going to the auction week in and week out, fighting for less cars, which cause prices to go up,” says Shamaley.
And even though some cars are ready to drive you to work with an uncertain economy, many people have been reluctant to get a new car for fear of losing their jobs.
“A lot of people are scared right now, they're more timid and more reluctant to make a decision that's going to affect them for the next 5 years as they were 2 years ago,” says Shamaley.
“Has there been a noticeable drop in folks coming through the door? Tremendous. Yes. All the way around, it's not just us. We talk to other dealers every day it's a lot slower than it used to be,” says Shamaley.
But with prices coming down, bargain hunters may start returning to used car lots.
‘I look for a great bargain. Something that's going to be sound, still has factory warranty if something goes wrong, I have something to fall back on,” says Victor Chavez, car shopper.
“The economy's going to turn around. You just gotta take the dive. Just buy it, why wait?” says Chavez.
Nationally, used car prices peaked in May, but despite the downward trend in recent months, prices are still higher than they were at this time last year.