Nada Used Car Prices, Edmunds Used Car Prices, And Kelly Blue Book Used Car Prices ÔÇô Whose Prices Are Right_.pdf
Published on: Mar 3, 2016
Transcripts - Nada Used Car Prices, Edmunds Used Car Prices, And Kelly Blue Book Used Car Prices ÔÇô Whose Prices Are Right_.pdf
Nada Used Car Prices, Edmunds Used Car Prices, And Kelly Blue Book Used CarPrices – Whose Prices Are Right?The Internet has been touted as the greatest resource for the used car buyer.Prospective buyers can find trade-in, private party, and retail values in a heartbeat.The question to consider, however, is what Internet source is right? The three majorsites: NADA, Edmunds, and Kelly Blue Book are clamoring to be the TrustedAuthority on used car values. Yet price discrepancies are frequently in the $1000’sfrom site to site. Which web site, if any, is the most accurate source for the used carbuyer?To illustrate the discrepancies, here’s an everyday example: NADA may retail a 2003SAAB 9-5 Linear at $15,996, Kelly Blue Book prices it at $17,456, and Edmundsprices it at $14,800. These are all retail values, assuming excellent or clean condition.$17,456 minus $14,800 is a $2,656 difference. That’s a huge price difference in thehighly competitive used car market.The retail values placed on many vehicles by these web sites can have even largerprice differences - some as high as $4000 to $8000 dollars. These gigantic pricefluctuations can leave a used car buyer spending $1000’s extra, depending on whichguide he or she used. Moreover, private party and trade-in sale prices do notaccurately account for vehicle condition, and less than 5% qualify as excellent.Vehicle condition is a critical variable. An owner might think his trade-in is instunning condition and thus worth X, based on his Internet research. An expert mayknow it needs $1000’s in repairs and reconditioning costs.The answer to “whose prices are right” is that none of the big three web sites reflectused car prices accurately. Most often, the prices are too high on the retail side,questionable on the trade-in side, and confusing on the private side.So what or who is the real authority? The answer is the Market! The market (i.e., thefolks grinding it out everyday in the used car market place – sellers and buyers)reflect true market value. Web sites are guides only. The used car prices from thesesources need to be measured against the reality of the market.Here’s a scenario to illustrate the importance the market plays on used car values. Inthe Northeast, the banks rely on NADA, used car dealers prefer to use Kelly BlueBook, and used car buyers are turning more and more to Edmunds. Now the dealerwill likely want to use the inflated (Excellent condition) Kelly Blue Book value. Thebuyer wants an unrealistic Edmunds price, and the bank wants to use an under-valuedNADA price. In other words, the three primary people in the car buying process – thebuyer, the seller, and the lender, are all on different pages. Each player wants the mostadvantageous price based on the part he or she is playing. The market is the onlyelement that evens the playing field. The point here is to demonstrate that the marketis the true source to determine a REAL and FAIR used car value.In order to get a fair price, according to the market, a used car buyer should aim forthe middle. Avoid the highest prices and be realistic and flexible about the lowest.Stay somewhere in the middle to get a fair deal.If you want a great deal, follow the market closely. If buying from a retailer, eBay andauction prices don’t count, as these are wholesale venues. Check out Cars.com,AutoTrader.com, and some of the other Used Car Sources. See what the vehicle youwant (including miles, equipment and accessories) is being advertised for. Again,shoot for the middle!
Use the popular Internet resources, but don’t follow them blindly. You may actuallypay significantly more than market value.
Use the popular Internet resources, but don’t follow them blindly. You may actuallypay significantly more than market value.Having said all this, this doesn’t mean that used car dealers are going to stop trying tolow ball trade-in offers. And of course every dealer wants to sell its vehicles for amaximum. But remember, the same goes for car owners, but in reverse. They wantthe highest price for a trade and the lowest retail price on a vehicle.When using Internet sources to determine a used car value, be sure to enter the correctinformation. This may sound elementary, but option packages, models, miles, color,equipment, engine, transmission, gear ratios…etc, can be confusing. Yet these areimportant variables that will affect prices dramatically. In short, the wronginformation skews the numbers.Finally, what really needs to be highlighted with NADA, Edmunds, and Kelly, as wellas other Internet sources, is that they are GUIDES. They are excellent resources forvehicle information, but weak resources for prices. This is not to bad mouth any ofthese sites – they are great starting points. Remember, however, that these guides mayor may not be in the car buyer’s favor. Fair used cars prices are dictated by themarket. Yes, do your research on the Net, but don’t cling to it. Use the Internet only tofind the used car market’s middle ground.Ottawa used cars