The true value of your used car
I have been in the automobile business for over 20 years. As with everything else, the Internet has changed many parts of the automotive industry. Many changes are positive, like the number of people you can market to when you sell a car, and some are negative, like the overall internet reviews of your individual car.
As a top-of-the-line, mostly-imported, used-car dealer who has been a licensed independent for over a dozen years, I have grown accustomed to people with no automotive experience telling me how much my cars are worth, and I take with a grain of salt. I know what a car is worth. Since I also know that people are full of fear when they dive into the used car market, I am ready for your questions, defensiveness, and buying tactics. I have the right experience to explain how I have priced a vehicle that I have for sale. You can disagree with me if you want, and you don’t have to buy the car I have for sale, but I’ve done my research. What amazes me about the car buying cycle is how people can be so defensive when buying a car and completely helpless when selling it. This is something that web based companies like Kelly Blue Book seem to take into account with their pricing strategy for your car, your helplessness. They miss the mark for the consumer and, in the process, help the dealer a great deal. My personal story with the Kelly Blue book could take dozens of pages, but a recent one in my memory is when I sold a 2000 Toyota Tacoma SR5, Pre-Runner, Access cab, that KBB didn’t have an SR5 option on the list to choose from. Small thing for KBB, but I had twenty interested buyers trying to tell me I was asking too much for my Tacoma, based on Kelly Blue Book values. The lucky guy who ended up buying this beautiful, one-owner, accident-free Tacoma didn’t click to see how much something was worth, he searched the city and online, and knew the right price for a good vehicle when he saw one. Nineteen other people lost a large truck. You still can’t believe everything you read. The application of good common sense must still be involved in the process of buying and selling cars.
Where does the everyday consumer fit into my story? You fit everywhere. I talk to hundreds of people each year who are in the process of buying and selling a car. I get a glimpse into their lives, what their circumstances are right now, and how a buying or selling mistake, for many of them, takes a long time to recover from. It used to be said that his vehicle was his second largest purchase in life, second only to his house. An important purchase. Now, living in an age of easy credit, easy credit disasters, home collapses, etc. It has become the biggest expense for many people. This puts a vehicle in the higher investment category for some people.
That’s why I’m concerned about the Kelly Blue Book and Internet prices, in general, and the people willing to believe and follow it. They don’t look at your car as your investment. They consider it to be worth very little to you at the time of trade, worth a little more if you sell it yourself, and worth a lot more if sold by a dealer.
For example, if you own a 2005 Honda Accord EX V6, with 85k miles, and decide to buy a new one, you can visit Kelly Blue Book and see that your local dealer will offer you around $9300. at a trade-in, if your car is in “good” condition. So you change it. Let’s say you have the new car you wanted, you return to the dealership to finish some paperwork the following week, and you see your used car on the lot for $14,600, a whopping $5,300. more than you have in trade. If that doesn’t stop you from trading in your car anymore, then you have a lot more money than time. I also disagree with KBB’s theory that the private party value must be $11,600 or $3000. less than the retail value. A car is worth what it is worth. If a dealer is going to order your car from the retailer, you should too. It’s your car, your investment, and you can ask for what you think it’s worth and trade if you want. Always remember, your car is an investment you paid for, kept and spent money on, and there was a time when a private vehicle was worth more than a used one on the dealership lot. If you want to believe that a dealer spends thousands on reconditioning that vehicle, and so they’re asking a lot more for it, fine. Then with all that reconditioning, the dealer shouldn’t have to shove a $1500 used car warranty on the next person who buys it.
If you want to be smart with your money and not throw away thousands, take your time when deciding to buy a different vehicle. Learn the true value of your car by visiting many websites that show actual vehicles for sale. Be prepared to answer questions about your prices and justify with facts why you are asking what you are asking. If you know the true value of your car, you will be the authority, and with all the information available today, you should be the authority on one of your biggest investments. Your car.