Used-car prices are expected to increase in the near future as a result of Superstorm Sandy, according to the National Automobile Dealers Association, or NADA. The group predicts that prices for used cars up to 8 years old will jump 0.5 percent to 1.5 percent nationally in December.
The increase is due to the loss of used cars that were currently for sale, as well as an increased demand to buy a used car by people whose cars were lost or damaged due to Sandy, including those cars for which an car insurance payout was made.
In particular, NADA expects that prices for large pickup trucks will be at the high end of the projected increase. Demand for those types of vehicles will be exceptionally high since they are typically used in the construction industry, and the overall available supply of pickups was smaller than normal before the storm. The higher used-car prices will mean consumers will need to be even more diligent when shopping for a car loan to ensure they get the best interest rate possible.
While the 0.5 percent to 1.5 percent increase is expected nationally, NADA noted that prices may be even higher in areas affected by Superstorm Sandy. Import and luxury brands are likely to see the highest increases since those car types are most popular in that region, according to Jonathan Banks, executive automotive analysts for NADA's Used Car Guide.
Tara Baukus Mello writes the cars blog as well as the weekly Driving for Dollars column, providing both practical financial advice for consumers as well as insight into the latest developments in the automotive world. Follow her on Facebook here or on Twitter @SheDrives.