This is Kenny Martin, at Competition Cars and Classics.
Do you ever wonder why you see a car on a dealers lot actually go up in price, instead of down?
There are a few factors that can determine a cars current value.
Every car dealer knows, that February and March are the time everyone gets their tax returns. Sales of lower priced cars have a huge spike during this time!
During December, and January, every dealer is fighting at auctions to stock up on inventory to prepare for the increased sales. This drives prices higher at auctions, and in turn, higher to the consumer.
Many times your so called "book values", have no time to adjust for this spike in sales. A car that was worth $4,000 in November, could easily be a $5,000 car in February of the next year due to supply and demand!
Another factor is availability. Lets say a dealer has a hard to get unit that is really in demand, ( lets say a 2006 Toyota Tacoma) and there are 3 others on the market within 100 miles of him. Then 2 of them sell, including the closest ones to him. All of a sudden there is only 2 including his within 100 mile radius he considers competition. That value just went up as it is now a harder to find and replace unit. Some dealers will choose to raise the price in this instance, and some may not. Supply and demand is always a major factor in used car pricing.
You can find all the Chevy Malibu's or Ford Fusion's you want at reasonable prices, but you start looking at Toyota Tacoma's, Toyota 4Runner's, Jeep Wranglers, and any lower priced 4x4 trucks, and the demand gets higher and the supply gets lower.
While we mostly associate car values as a depreciating value, circumstances can actually increase a vehicles worth.
