Prices for used cars are skyrocketing, yet buyers continue to queue for them | Carscoops

      There is an increasing shortage of used cars, leading to higher prices for buyers.

      A recent report reveals that used vehicles are selling over twice as quickly compared to the same period last year, despite the rise in prices and the shrinking inventory of used cars.

      The ongoing high demand and elevated prices are expected to persist, and tariffs may further complicate the situation.

      Economists caution that tariffs might create problems similar to those seen during the pandemic and the chip crisis. This trend is already apparent, as CarFax reports that the rise in used car prices is nearly double compared to last year, and the increase in sales is more than double what was observed last spring.

      Essentially, used cars are pricier, but they are selling rapidly. This surge can likely be attributed to consumers hurrying to dealerships to purchase new and used vehicles before prices rise further, potentially by thousands of dollars.

      Moreover, CarFax has highlighted a "worsening used car shortage," which is contributing to the rising prices. Last month, the average price of non-luxury SUVs increased by $400, while truck prices rose by about $250, and van prices soared by $800.

      Although CarFax did not specifically mention tariffs, they did indicate that "growing economic uncertainty is motivating many car buyers." They also suggested that conditions may deteriorate before improving.

      Srinidhi Melkote from CarFax stated, “We anticipate this increase in car prices and sales will continue. The strong demand for new cars has driven up new car prices and reduced supply, leading some consumers to seek used cars as a more affordable alternative. This shift in buying behavior will also raise used car prices, creating a ripple effect in the market.”

      Additionally, it's important to note that automakers have halted production and shipping of certain models as a response to tariffs. These actions are likely to exert further pressure on prices and further deplete dealership inventories.