Auto shoppers can expect a cool down in prices for new and used cars

Are you in the market for a new car in 2024? Now might be the perfect time to buy, as the landscape for car shopping is looking more favorable than it has been in recent years.

According to Kelley Blue Book, the average transaction price for a new car in the U.S. has decreased to $47,244, down 2.2% from February 2023 and 5.4% from the market peak in December 2022. While this is a positive sign for buyers, prices are still considerably higher than they were in February 2021.

Experts predict that while prices are slowly stabilizing and incentives like rebates and discounts are making a comeback, they may never return to pre-pandemic levels. The CEO of CoPilot, Pat Ryan, states that the new normal range of prices is here to stay, with structural changes in the industry keeping prices elevated.

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One reason for the increase in car prices is the advanced technology and high labor costs involved in manufacturing new vehicles. Features like anti-collision systems and electronic components have driven up the cost of repairs, making even minor accidents more expensive to fix.

The used car market has also been impacted by the pandemic, with fewer new cars being produced and more drivers holding onto their vehicles. This has led to a shortage of used cars, keeping prices elevated and putting a floor on depreciation.

For those looking to buy a car in 2024, experts suggest that incentives between April and July will be the most attractive in the new car market. Interest rates are expected to decrease, providing some relief for buyers. Incentives on new cars are also increasing, but shoppers will need to hunt for the best deals.

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Overall, despite the lingering effects of the pandemic on the car market, 2024 is shaping up to be a better time to buy a car. Whether you’re in the market for a new or used vehicle, there are deals to be found for savvy shoppers willing to do their research.

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