But it turns out there's not much refuge from high prices there, either. Used cars are costing more on higher demand, with sales up compared with last year.
The average new car went for $31,831 last year compared with the previous year, up 1.9%, automotive data site TrueCar reports, while the average used car sold for about half that, $16,335. But that was a 5.1% jump from 2013, says TrueCar, with overall used-car sales up 3.3%.
Used cars are just now fighting back from the hangover of recession — years of slower new-car sales that now have led to few late-model used cars hitting the market.
"It has climbed steadily .. .back to pre-recessionary levels," says Tom Kontos, chief economist for Adesa, a wholesale auction for used vehicles.
The biggest used price gains are coming in trucks. "The car group as a whole, mid and small, their bottom isn't dropping out, but they are a better bargain these days than trucks," he says.
Kontos, in his most recent analysis, found that used car and truck prices together at the wholesale level rose 1.1%. But then came the split: Cars went up 0.9% in November compared with the same month the year before. But with lower gas prices and the resurgence in homebuilding and other construction trades, the average price for used pickups, vans and SUVs rose an average of 6.3%.
Some categories shot up more. Prices of small SUVs were up 8.8% at the wholesale level, full-size vans increased 10.5% and midsize SUVs saw a 11.2% price boost.
Gains for used pickups are a turnaround from about five years ago, when the construction downturn amid the recession and sky-high gas prices teamed to reduce their prices. "A few years ago, they were oversold or just coming into the used-car market," Kontos says.
For many dealers, manufacturer-certified used cars remain hot, driven by customer demand. They're a good business proposition: a smart dealer can make higher profit margins on certified used cars than new ones.
That part of the business has picked up as customers have become more aware of certified-used cream puffs as an alternative to buying a new car. "Consumers didn't know about it to the extent they know of it today," Konto says.
Overall, the "market looks very, very strong," says Alec Gutierrez, analyst for Kelley Blue Book.
