- Thanks to massive shortages and high demand, buying a car now is trickier than ever.
- Shoppers should be extra flexible on just about every aspect of buying a car, experts told Insider.
- There are also pros to leasing a vehicle or delaying a purchase until this all blows over.
If you’ve been following the news, shopping for a car probably feels incredibly daunting right about now.
Between a computer chip shortage, booming demand for cars, and a rat’s nest of other pandemic-related factors, vehicles are in short supply nationwide. Practically all cars – from the latest models to decade-old clunkers – cost significantly more than they did a year and a half ago.
It all means that the decisions surrounding buying a car have become more challenging than ever before. Successfully navigating this difficult market means resetting your expectations, expanding the options you’ll consider, and possibly even deciding not to buy a car at all, experts told Insider.
Flexibility is key
There’s a good chance you won’t find exactly what you’re looking for at precisely the price point you’re used to. Being open to a variety of brands, models, and options is the way to go in today’s market, Brian Moody, Autotrader’s executive editor, told Insider.
“The person who’s probably going to do the worst in terms of finding what they want is the person who’s very rigid,” he said.
People looking to buy secondhand should broaden their search to include older models than they’d normally consider, says Benjamin Preston, an automotive reporter at Consumer Reports. On the new side of things, being open to less-popular vehicle types like sedans, hatchbacks, and smaller SUVs could pay off, he added.
Prepare to pay up
Whether you’re shopping new or used, expect to fork over much more than you’re accustomed to, Ivan Drury, senior manager of insights at Edmunds, told Insider. New vehicles are selling at or above MSRP. And used cars, even older ones, are worth thousands more than before the pandemic. Some lightly-used vehicles are selling for as much or more than their new counterparts.
And don’t go in expecting to negotiate thousands off of a vehicle’s sticker price, Drury said. While that may have worked before, right now there are way more customers than cars – and dealers know that.
If you decide to stomach the astronomical used-car prices, be sure to keep that vehicle for the long haul, Drury said. One of the worst things you can do for your wallet right now is to buy a vehicle at today’s prices and dump it in a year or two.
Leasing may be your best friend
If you’re having trouble finding what you’re looking for or can’t afford the eye-watering price tags of some in-demand models, consider leasing until it all blows over, Drury said.
“Just borrow something you’re okay with instead of buying something you don’t love,” he says.
Leasing costs less per month than paying off a car loan, but the trade-off is you have to return the vehicle after the two- or three-year lease period. People who go this route should check automaker websites for lease specials on certain models and trims, Drury said. Customers afraid of exceeding the mileage limit on a lease should see if they can add miles at the beginning of their contract.
“Bottom-line shoppers” who are leasing as a last resort should hunt for vehicles with the lowest monthly cost and the lowest up-front payment, Moody said.
Work with what you’ve got
With prices the way they are, investing in an existing vehicle could make more financial sense than it did just a few months ago, Preston, of Consumer Reports, said. Even expensive repairs may be worth it in the long run if they allow you to delay a purchase and escape today’s chaotic market.
“Our advice is if you can wait, that’s probably your best bet,” Preston said.
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