When you go to buy a used car, you might be wondering how exactly the price for a used car is determined.
Local used car dealers typically have two different price points they deal with when it comes to used cars. The first price point is the trade-in value, which is the value of your car traded in towards another car. The second price point is the retail price that dealers then turn around and sell the car for. Since dealers want to make a profit on the trade-in, the retail price is always higher than the trade-in value.
There are several factors that affect both trade-in value and retail value when you buy a used car.
One of the first factors is the mileage of a vehicle. The rule of thumb is about 10,000 miles per year as an average number. So if a car is four years old but has 70,000 miles on it, it would be considered a high mileage vehicle. Another important aspect of mileage is equipment that might need to be replaced at certain markers. Many parts have mileage indicators on how long they are expected to last.
Another factor used by local used car dealers to determine value is the trim package. Originally higher-priced trim packages typically up the value of the car. However, this generally only applies to extras put in place by the car manufacturer. Aftermarket parts such as lifts or high-powered stereo systems can actually lower the price because they do not have universal appeal.
The model year and make affects the car’s used value as well. Newer cars usually have a higher resale value than older cars. However, there are exceptions to this as well. Certain makes have better resale value either through reliability reports or market demand. Sometimes certain years of a vehicle have reported problems that can also lower the value.
Lastly, the condition of the vehicle is another important factor. This includes regular maintenance as well as the condition of the interior and body of the vehicle. One of the benefits of buying a used car from a dealer is that the vehicle is usually given a thorough inspection to make sure that it does not have any glaring problems. With private sellers, only meticulous maintenance records can ascertain this.
If you have any more questions about pricing a used car, feel free to ask us at Platte City-Airport Chrysler. We’re here to help you!