Used Car Prices Dropping

Brand new cars with turbos and superchargers cost a lot of money, this makes sense.  What’s confusing is how used car prices sky rocketed in the last few years.  It was getting to the point where someone could actually sell a car for more than they paid for it a year down the road.

A few factors led to the price increase of used cars. No one wanted to take out new debt, or they couldn’t qualify for credit to buy a new car.  So, owners held onto their own used cars. Car manufacturers also limited the amount of production during the recession.  Since no one bought cars and car companies didn’t make any cars, a shortage of used cars existed.  Since I was able to stay awake in most of my Econ classes at school, I know that when supply goes down price goes up.

Now that there is some light at the end of the tunnel of the recession and gas prices have leveled off, people are buying new cars again.  Used car demand is going down a bit, and thus so are the prices. The National Auto Dealers Association of America predicts that prices on used cars will continue to fall.  Midsized and compact cars could see a decrease up to 5% in June.

Buying a Car Modified by a Previous Owner

We all see cars that have been modified by their owners and now they are hitting the street with a for sale sign on it. Cars with a custom supercharger or turbocharger that has been installed to add power or lowered suspension to add that custom look. What may seem like a great buy at first can turn into a money pit and a huge headache.

There are plenty of tuner companies that sell tuned versions of cars like custom shops and other tuning houses but they all stand behind their work. What we are looking at is the tuned car that has been modified by someone in their garage and lets be honest not everyone does every install correctly. There are a few things to look for when purchasing a modified used car. The first step is to meet the previous owner, if they are a 50 year old man who is a car enthusiast and modified his BMW with all Dinan accessories you will probably be ok. Now on the other hand if the person selling the car is a 19 year old with a low budget and a thirst for speed than probably want to skip it.

Aftermarket performance parts are just like everything else and that is to say "ya get what ya pay for", cheap ebay parts are just that. Parts that have been built and tested with quality are more expensive not only because the look cool but the cost of building and testing them is high. Cheap parts are usually a low cost version of a quality part which means that materials are not as good and the build quality is lacking. Low build quality means reduced performance and shorter life of the part. The other factor to consider is the "cutting corners" of a cheap car build. Younger owners then to be do it yourselfers and they may not know how to do the installs correctly so all work down on a potential purchase will have to be looked over.

A modified car can be a great purchase especially if the car already has a bunch of modifications that are on the "To Do" list. It can be hard to resist the draw of a car that already has the parts you want. In the long run it may be better to pass and buy the basic car and add the parts yourself just cause you know it has been done right.