What’s the absolute best time of the year to buy a used car? The answer isn’t as simple as a season or a month, but pretty easy to understand. A little industry knowledge on value, life cycles, and insider practices can help you narrow that purchase time to an exact moment.
First, a major requisite for applying the information in this article is buying from a dealer. Private seller buying is much more nuanced and the techniques here wont apply. So for this article I’ll be talking about dealership only purchases.
Name of the game when buying used
We’ve all heard the ads for the biggest deals and year end blow outs. Are they legit? Short answer, is yes.
0% apr. No money down. Sign and drive. You have heard all these things before, however most of those things only apply to new car purchases. A Used car rarely applies for these discount because manufacturers don’t support secondary purchases.
So what does apply? Mainly, Depreciation. It’s the reason we choose used over new and its our game.
You buy a car that has all the features you want and need, without the heft of its original price tag.
According to an article by Carfax, the average new car will lose 60% of its value in the first 5 years of ownership! That hurts. Furthermore, the first year loses the most value with an initial 20% drop across the average.
You, astute buyer, can capitalize on this by selecting a car thats near the end of its initial depreciation. So we’re talking about choosing a car that somewhere in the 5-6 year old range.
Thats not an exact time of the year to buy a car I know, but we’re getting there. Buying the right car is just as important as when. What we’re really talking about here is making the ideal purchase.
Most car models run on a 5-7 year life span. Meaning most models retain their current body style for around at least 5 years before a manufacturer releases a new one.
Majority of the Major Autos also release their respective class cars within a year or so of each other. This is so one brand doesn’t get left behind.
For example, Toyota Camry, Honda Accord, Nissan Altima, Hyundai Sonata, and Volkswagen Jetta usually release about a year apart.
Competition is fierce, and great for the buyer. More selection equals more room for leverage. More leverage equals greater potential value in your purchase.
Conclusion: Planning when the best time to buy a used car is
You should plan a purchase to coincide within Industry timeframes.
When a car is about to replaced, manufacturers often have bigger than average discounts available on outgoing models. You can take advantage of this before the year ends. Most updated models are released before the new year begins. Example, 2022 models will be released in winter 2021 and sometimes as early as summer 2021.
Used cars have a typical trajectory of depreciation. 5-7 years is the typical model life of a car and loses majority of its value in those years.
Now the obvious and what you’ve all been waiting for. The Exact time of year.
The best time of the year to buy a used car is late Fall.
October and November are ideal months for you to take advantage of. Conventional wisdom suggests end of the year to be the best time to purchase and its true. Holidays, year end, and dealership incentives make it the peak time to get a car.
As the year closes in, dealerships have goals and quotas to hit. Lean into this and you can expect an average savings of up to 10% or more!
Heres a little bonus. The day of the week you buy a car makes a difference too. Yep. According to TrueCar, buying on a Sunday could gain you a percent or more savings in addition.
Whatever you buy just make sure it’s not a lemon. Check out the article on what not to do when buying a car.