Research used car pricing

When researching used car prices, you'll typically find three kinds of prices:

• Dealer or Retail Price is the price you should expect to pay if buying from a licensed new-car or used-car dealer — retail price. Dealer prices will always be the highest listed because of the dealership’s need to make a profit.

• Dealer Trade-in Price or wholesale price is the price you should expect to receive from a dealer if you trade in a car. This is also the price that a dealer will typically pay for a car at a dealer wholesale auction.

• Private-Party Price is the price you should expect to pay if you were buying from an individual. A private-party seller is hoping to get more money than they would with a trade-in to a dealer. A private-party buyer is hoping to pay less than the dealer retail price.

The growth of the Internet has fueled the availability of information on the prices of used cars. Whereas this information was once only available in trade publications that dealers had access to, there are now numerous sources for used car pricing. Multiple sources of used car pricing means that the prices you get from different sources often won't agree with each other. This is a result of each pricing guide receiving data from different sources and making different judgments about that data. The best way to determine a price is to cross-check prices with multiple sources and add a dose of your own good judgment to arrive at your price.

Pricing of used cars can be affected by geography; generally a convertible has a much higher demand in Florida than in New Hampshire. Similarly, pickups are often more in demand in rural than urban settings. Condition – Is the car in excellent, good or fair condition – has a major impact on pricing. Condition is based on appearances, vehicle history, mechanical condition and mileage. There is much subjectivity in how the condition of a car is evaluated.

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