Is there a best time to sell a car? The short answer is yes. Just as there is an ideal time to buy a car, there is also an ideal time to sell one. Cars begin to lose value from the moment that you hop behind the wheel and pull out of the dealership.
Most vehicles lose up to 20 percent of their value within their first year, notes Edmunds.com. Selling at the right time can mean getting the most out of your used vehicle and negating some of the loss.
Keep An Eye on the Calendar
If you’re looking for the best time of the year to sell your car, U.S. News and World Report recommends that you aim for March through August. The weather is nicer, and more people think of getting out and about, traveling or vacationing — in a new (to them) car. Christmas and other holidays have passed, so people have more money to spend, and for many folks, tax season is at hand, so refund checks are in the mail.
By contrast, if you can avoid selling your car toward the end of the year, do so. Car dealerships holding end-of-model-year sales get flooded with trade-ins, so the market is saturated and you may find yourself getting less for your used vehicle than if you hold off just a few more months. Similarly, buyers may have less money to spend on used vehicles at the end of the year, when budgets may be focused on making the holidays merry for their families.
There is an exception to end-of-the-year sales, however. If you are selling a 4WD or AWD vehicle, then you may see more interested buyers in the winter months if you live in a climate where the roads are icy, snowy and unforgiving. Vehicles that hold the promise of go-anywhere capabilities despite the elements tend to sell better in areas of the country where that’s an important selling factor, so this only applies if you live somewhere that experiences harsh winters.
In a similar vein, timing is also important for some vehicles. If you are selling a convertible, you may see a great deal of interest in May or June and waning or even no interest November through February.
Keep An Eye on the Mileage
When you buy a car, it starts to depreciate immediately. Depreciation is based on several different factors, the biggest of which is mileage. New-vehicle warranties start to expire anywhere between 25,000 and 100,000 miles and usually by that time most vehicles require some type of major repair or service beyond the run-of-the-mill tire rotation or oil change.
Typically, cars that have been driven 30,000 or more miles require new tires and brakes, and other types of problems can creep up at this point in the car’s life. Still, many experts say that a two-year-old used vehicle can be a very smart purchase; mileage and wear-and-tear are low but the original buyer has already taken the hit on depreciation, so you're getting lots for your money.
Sellers should remember that vehicles start to need repairs greater than regular maintenance when they're around four or five years old. So if your car is close to this point and you're on the fence, consider this an argument in favor of selling.
Model Year is Important
Remember that regardless of miles, the year of the car is also important. People perceive a car as being less valuable the older it gets, despite any advanced mileage or obvious wear-and-tear. Even the difference of one year, say a 2017 model versus a 2018 model, can lead to a perceived decline in value, even if both vehicles have identical mileage. Selling your car before another model year rolls around can help you get the most for it.
Also pay attention to your vehicle's generation. Vehicle generations last between five and eight years, with a mild update roughly two-thirds of the way through that period. If a new generation of your vehicle is due out soon, consider selling yours before that happens, when it seems more current and values will be higher. Once that next-generation hits the market, it can suppress the values of the older generations.
Get a Feel for the Local Market
Market conditions are not the same everywhere, so the best time to sell your used car in Tampa, Florida, may be different than the key timeframe for selling a car in Frankfort, Kentucky. Check out the local market by looking at used car sales sites, Craigslist, AutoTrader and other similar publications.
Supply and demand is important in the used car market and it can be a huge price determinant since buyers looking for a particular car have multiple options to pursue. If you are selling a Nissan Maxima and there are 20 others available locally, then you may want to hold off until the market clears up some to get the best price for your car and reduce haggling among potential buyers jockeying for the lowest price.
Listen to the Experts
Financial giant Morgan Stanley predicts that by 2021, used car prices will plummet by up to 50 percent, so selling sooner rather than later may be a smart move. Experts say what happened is that after the Great Recession, sales of new cars boomed, and many of those sales were actually leased vehicles, which are now creating a surplus since their lease terms are up. Sales of new cars have been strong in recent years, largely due to cheap lending, a healthy economy and dealer incentives that buyers can't pass up. This has created a reduced demand for pre-owned vehicles. This is particularly true if you are selling a midsize sedan or compact car since there is a shift away from those segments; buyers now prefer crossover SUVs instead.
The Bottom Line
While there may be no formula for determining the best time to sell a car, timing can be important to getting the most out of your investment when you’re ready to part ways with your used auto. Paying attention to market trends and the local demand for your particular vehicle can be important, and selling your car before it hits major milestones can help you get back more of what you’ve put into the car.