When you’re buying a car, you want to know exactly how much you’re paying and whether you’re getting a deal. Both of those things are a lot easier with two new updates to Shift’s vehicle pages: a market comparison tool from CarGurus and an improved price calculator. Continue reading “At Shift, Used Car Prices that Bare it All”
We heard this one all the time. A simple question with a not-so-simple answer: What is my car worth? Since the car market isn’t usually top of mind, it can be hard to think about value of your car. Car pricing guides like Kelley Blue Book act as good price anchors. But one-size-fits-all car pricing guides tend not to capture every element that could affect a car’s true value.
So we put together three real-world considerations that can impact car value that every seller (and buyer!) should have in mind the next time they’re in the market.
How Market Forces Affect Your Car’s Worth
The question of what your car is worth depends, in part, on what people are willing to pay for it. The laws of supply and demand lie at the heart of every transaction, and used cars are no different. But unlike commoditized goods like milk and coffee beans, the supply and demand for used car can vary widely from place to place. Think about if you live in a rural area — you probably want a car that can handle rough roads. If you live in a packed city on the other hand, a compact car is your best bet. So the demand for those vehicles will change with the location. When it comes to supply… well, your car might be a great one, but if there’s lot of your exact same car on the local market, it could make yours harder to sell at its KBB value.
Other things like area dealer presence and activity, seasonality, and even weather can also impact car pricing. The best way to capture this would be to look at a variety of actual, live listings in your area, how long they’ve been on the market, and compare them to each other. Shift’s estimate tool actually does this precise calculation for you, and when you schedule an evaluation, our Car Enthusiast will actually show you a graph of local vehicle listings similar to yours for your reference.
How Features Affect Your Car’s Worth
The car’s features can also throw a monkey wrench into an already tough calculation. How do the features of your car influence price? Well, it depends:
Paint color – 61% of the cars sold through Shift are black, white, silver, or grey. While not the most exciting, safe neutral colors are still the easiest to sell.
Bright or exotic colors can fare well among collectors and buyers looking on edges of the color palette, but because there are simply fewer adventurous buyers, you’ll either have to be more patient or lower the price of that lime green Beetle.
Transmission – Much to the dismay of car enthusiasts everywhere, fewer and fewer cars are being made with manual transmissions. As a result, fewer people are learning to drive stick. So if your ride sports a manual transmission, you are already significantly limiting your potential buyer audience and may have to lower the price or wait longer to sell.
Trim and package – While most used car shoppers would prefer leather seats and premium audio (hey, who wouldn’t?), whether or not they are willing to pay a premium for it is going to depend from buyer to buyer. Generally speaking, the older a car is, the harder it is to recoup the original cost of your car’s options.
Aftermarket parts – You’ll often see Craigslist listings that list out how much money has been put into the car in after market parts, but these modifications almost never bring a very good return on investment. In fact, because aftermarket parts have a poorer reputation for quality and durability, they could even hurt a car’s resale value. Some sellers will even reinstall the stock parts and just throw the aftermarket pieces into the deal (or sometimes not at all). When it comes to aftermarket mods, seller beware.
How Condition Affect Your Car’s Worth
It should come as no surprise that a car’s condition is a huge factor in determining its value, but when it comes to flaws, not all damage is the same. Deployed airbags, wheel misalignment, and frame damage, for example, are far more likely to hurt a vehicle’s value than fender dents or paint scratches. (That’s just one reason why every car listed on Shift must first pass a detailed inspection by our ASE-certified master mechanics — and why only 3 out of 5 cars make the cut.)
By that same token, not all repairs are the same, either. Even assuming that all repairs are done by an equally skilled hand (which isn’t always the case), some repairs can do more to improve a car’s value than others.
So if you find yourself confused about car pricing, you’re not alone—determining a car’s worth is no easy task. Know that car pricing guides such as KBB are just starting points. If you’re ever looking for a second opinion, check out our quote estimate tool, which already takes your local market into account.