Used car prices are finally returning to earth.
After climbing throughout most of the COVID-19 pandemic, used car prices finally fell 2% in November and 3% in December, according to iSeeCars.
In the last month of the year, the average used car price dropped more than $1,000, which iSeeCars characterized as the “first substantial drop in more than 2 years.”
For a handful of models, the price drop has been especially sharp. Following are the four models that saw price declines of more than 10% over the last quarter of 2022, according to a recent iSeeCars analysis of 1.9 million sales of used cars that were 1 to 5 years old.
By comparison, the average used car actually saw a slight price increase, 0.6%, from September to December.
1. Tesla Model 3
Average used car price as of December: $43,817 (which is 16.8% lower than it was in September)
While no one is likely to ever characterize the price of the Tesla Model 3 as “cheap,” the price of this trendy car is coming down. Purchasing one of these cars used in December would have saved you $8,822, on average, compared with buying it in September.
In a summary of the iSeeCars’ findings, Karl Brauer, executive analyst at iSeeCars.com, says:
“Cars like the Chevrolet Camaro, Ford Mustang, Mercedes-Benz G-Class, and Tesla Model 3 were commonly leading the price hikes at the height of pandemic pricing, with people willing to pay whatever it took to get one.”
But now, Brauer notes, these models are among the used vehicles that have seen prices drop the most over the past 12 months.
2. Nissan Kicks
Average used car price as of December: $20,046 (which is 11.9% lower than it was in September)
A driver who bought a used Nissan Kicks in December saved an average of $2,718 over what they would have paid for the same car in September.
Such declines in prices bode well for car shoppers in the future, Brauer notes. Although he says the market remains “a long way from ‘normal,’” the elevated prices of the past couple of years are rapidly becoming a thing of the past.
As Brauer says in the iSeeCars summary:
“It was easy to predict, given the macroeconomic factors we’ve seen over the past 6 months. With everything from inflation to interest rates hitting peak numbers there was no way the upward pressure on car values could continue. The next big question is: how far and how fast will car prices fall?”
3. Ford Mustang
Average used car price as of December: $26,852 (which is 11.5% lower than it was in September)
The iconic Ford Mustang has been going strong for decades. Buying this car used in December would have saved you $3,495, on average, over what you would have paid for the same vehicle in September.
According to iSeeCars, used car prices fell during every month of 2022, month over month, but did not slip year over year until November.
4. Hyundai Ioniq Hybrid
Average used car price as of December: $20,542 (which is 11% lower than it was in September)
Rounding out the top four is the Hyundai Ioniq Hybrid, which cost $2,527 less in December than it did in September, on average.
Although used car prices overall are falling, prices for some vehicles remain elevated, according to iSeeCars. It notes that used electric and hybrid vehicles remain in demand. The Chevrolet Bolt, Nissan Leaf and Prius Prime all have prices that are up 20% year over year.
Other models with steep price drops
Other used vehicles that made the iSeeCars list include:
- Toyota RAV4: Average used price of $28,383 as of December (which is 8.9% lower than it was in September)
- Jaguar E-PACE: $35,221 (8% lower)
- GMC Acadia: $30,922 (7.7% lower)
- Ford Ecosport: $20,064 (7% lower)
- Toyota Camry: $25,521 (7% lower)
- Audi SQ5: $44,447 (6.8% lower)