Used car prices hit four year low

New car sales are up – way up – but that pent-up demand has left the used car market relatively weak. Values for pre-owned vehicles are at a four-year low as buyers flock toward brand new vehicles.

According to Edmunds, the average used car price in the United States during the last quarter was $15,617, the lowest figure since all the way back in 2009 when pre-owned vehicle transaction prices hit $14,808. Used car values during the third quarter of 2013 were down nearly 3 percent compared to the same period last year.

Wholesale prices, meanwhile, climbed slightly in October – but they have been sliding for the last several months.

Why are used car prices so low? Not only is there more demand for new cars than before, but there’s also a glut of off-lease used cars. Cars leased three years ago – typically 2009 and 2010 models – are flooding the market. In late 2009 through 2010, automakers began pushing highly incentivized lease deals as a way to clear out inventory to combat weak demand during the recession.

Analysts predict that more used cars will hit the market over the next few months, which is likely to continue depressing pre-owned vehicle values.