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March 8, 2022
A 2022 Car Buying Guide: Advice On Whether To Buy or Sell This Year
Our 2022 JD Collision Car Buying Guide promises to give you the confidence to navigate the current automotive market and make the right car buying decision for you and your family.
Should you buy or sell a car in 2022, or hold off until next year? Should you buy new or used? What about whether to finance or lease?
We dug into these questions and compiled a list of considerations to help you answer them for yourself—read on.
What Do Current Automotive Trends Mean for Buyers and Sellers?
In last month’s edition of our blog, we looked at current automotive industry trends. What do these trends mean for car buyers and sellers in 2022?
Here are 7 considerations to keep in mind when deciding to buy or sell this year.
1. Do your research
Whether you plan to visit a dealership or buy a car online, it’s important to know which vehicles you’re interested in before you start the buying process. If you don’t, the speed of the market and lack of choice could cause you to make a hasty decision you’ll later regret.
Understand your car needs and wants, then make a priority list with the following:
- Vehicle size including passenger capacity and cargo space
- Safety ratings
- Performance specs
- Consumer Reports rankings
- Car model
- Preferred features
- Fuel efficiency
Once you’ve figured out your vehicle must-haves and like-to-haves, you’ll have an easier time narrowing down your search.
Make a list of the vehicles you want in order of priority and then be willing to move down the list as availability and prices change. Stay flexible on things like colour, trim level, features, manufacturer, and model.
If you’ve always bought used, consider new. If you’ve always bought locally, be ready to expand your search farther from home—perhaps to another province!
2. Be ready to drive, er, move quickly
Source: patruflo/Envato Elements
Unfortunately, our pre-pandemic world doesn’t afford the same timing when buying a car as it did before COVID-19.
It’s a sellers market which means that, whether you’re looking to buy new or used, deals happen fast.
Tire kickers need not apply
J.D. Power reported that at the beginning of 2022, the average number of days a new vehicle was in a dealer’s possession before being sold is 19 days—down from 51 days a year ago.
With that in mind, research becomes more important than ever. Know what you want, then go out and be prepared to buy.
The car buying experience was already ripe with confusion, intimidation, and pressure tactics. Pandemic-related complications have only made matters worse.
Don’t let a seller’s market pressure you into getting a vehicle you don’t want. Be prepared to walk away from a deal in order to avoid an expensive mistake you’ll later regret. Patience may be your best friend when it comes to buying a car in 2022.
At the end of the day, you want to be happy with your ultimate decision.
3. New vehicles will cost more
Vehicles that make it onto the market these days are often only available in higher, more expensive trim levels.
Dealers are also less willing to negotiate on price, if at all; it’s a textbook case of supply and demand. Consider the MSRP, or Manufacturer’s Suggested Retail Price, to be a fair price.
Tip: The demand for SUVs and trucks is higher than for cars. You may find room to negotiate if you buy a sedan instead.
There’s still room to negotiate
Even though a car buyer won’t have room to negotiate on price in 2022, they can bargain at the margins.
Ask about bonus extended warranty coverage, free oil changes for the term of a lease or for a certain number of years, the inclusion of winter tires and car mats, etc.
4. Pre-order online
One way to avoid paying a premium on a new vehicle this year is to order it online. Online purchases save dealerships money, savings which can then passed along to the consumer.
You’ll have a greater chance of getting your preferred car model, trim level, and colour, and avoid the disappointment of having the car you want sell before you get to the dealership, by pre-ordering it on a car maker’s website.
As long as you’re willing to wait for your new vehicle, for as long as several months, this is a great option for current car buyers.
5. Used vehicles are more expensive than ever
Because of delays in delivery and availability of new cars, buyers shifted to purchasing used cars over the past two years.
The bad news is this means used cars are now more expensive than ever. The good news is that if you’re looking to sell, you can do so for a premium.
Used car price increase vary depending on type
The price of a used vehicle is up across the board. The rate of increase, however, varies by type and age of vehicle. Cars have seen the largest increase, compared to trucks and SUVs of the same age.
Tip: If you’re buying a used car, pick a certified pre-owned vehicle. This will ensure the vehicle is under warranty, plus you’ll often get it at a lower interest rate.
Use your second-hand vehicle as a bargaining chip
Another piece of good news related to surging used car prices is high resale value.
If you’re in the market to buy new and have a vehicle to trade in, take advantage of it!
This is where you can take your time (but not too long—more on this soon). Do your research. Find out online what your second-hand vehicle is worth. Shop your used vehicle around for the best price. Don’t simply accept a dealership’s trade-in offer.
You may even opt to sell your car first and then put that cash towards a new automobile.
The used-case bubble will burst
As new-car inventory begins to stabilize, the second-hand car bubble will burst. Experts predict the high resale value of used cars will start to stabilize late 2022, early 2023.
If you’re thinking about selling or trading-in your ride to take advantage of current pricing trends, don’t wait until the year is over. You may find you’ve missed the window.
6. Finance a vehicle through a dealership
If you’re looking at automotive financing to purchase a new car, consider what’s offered by the dealer. Dealerships are incentivized to offer financing and often offer better rates and terms compared to, say, a bank auto loan.
7. Rethink leasing a vehicle
Because there are fewer new cars on the market currently, a car lease has become more expensive. This trend negates one of the biggest reasons to get a lease: it gets you into a newer, nicer vehicle at a lower rate.
On the plus side, because prices have skyrocketed, a lease could be an affordable option for some people.
Tip: If your current lease is ending soon, consider buying out your lease. The buy-out will be much less than going new as it was likely calculated prior to the surge in auto prices.
Buy or Sell a Car in 2022? Our Final Answer
Now that we’ve weighed the current automotive market, you’re probably asking yourself: is it better to buy new or used in 2022?
Our final answer? If you can afford to, buy new.
If you have a used vehicle you’re looking to trade-in or sell, book it in with us for an auto body touch-up and detailing.
Or, if you’ve decided the lack of supply and the speed at which cars are disappearing from lots is too much excitement for you, there’s nothing wrong with keeping your current vehicle and maintaining it instead.
Contact us today to book.