Buying a Car in 2021
The 2021 car market has been tough for those searching for a new or used car. Low dealer inventory, a global microchip shortage, and consumer demand are making it increasingly difficult and expensive to shop for new and used vehicles.
According to Edmunds, used cars are more desirable to customers who either can’t find what they’re looking for or want a cheaper option. With lower inventory and spiking demand, dealers have little incentive to offer discounts on any of their cars.
Although finding the perfect car right now can seem challenging, there are still plenty of ways to get behind the wheel of your new ride. Visiting a lot and purchasing directly from the dealer is the traditional way to buy a car, but there are alternative options now, such as shopping online.
If you want a concierge experience, exploring a door-to-door service, like Carvana, can be appealing. Unfortunately, going through a more convenient option could cost quite a bit more when fees are included. According to The Balance, concierge services typically charge an upfront fee, as well as a percentage of the savings found. These extra fees could cost up to an additional $1,000 — so weighing the convenience and investment costs is a smart budgeting practice.
No matter how you buy your new or used car, set reasonable expectations for the market that we’re in, keep an open mind, and exercise patience during your search.
Car Buying Tips in 2021
With ultra-low dealer inventory and a global microchip shortage, car buying is a challenge this year. Here are some helpful tips from the experts at Edmunds on the best way to plan ahead:
- Research market prices and realign your expectations. How do you know what a good deal looks like in today’s market? Take a look at comparable vehicles in your area to see what the going rate is. Many of the price books out there use historical data to help predict prices. While that’s usually fine, you may see dealerships asking for more than usual due to the unpredictable microchip shortage. Don’t be surprised if a dealership only discounts the vehicle by a few hundred dollars, holds the line on the sticker price, or even sets a price above MSRP (manufacturer’s suggested retail price).
- Expand your search. If you aren’t satisfied with the selection in your area, broaden your search to neighboring towns and counties. By casting a wider net, you might find a better car or even a better deal.
- Be flexible and have a backup. Inventory is limited these days so try not to fixate on one specific car color or brand. Have backup picks in colors and even a range of different models to give yourself the most flexibility. If you’ve narrowed down the model you want, consider its equivalent at another brand to give you more options.
- Consider a sedan. Trucks and SUVs are by far the most popular vehicles on the road today, which means they’ll be more expensive and harder to find. Modern sedans offer more space than ever and could also be easier to find and more affordable.
- Don’t rule out a new car. If you’re set on buying used, consider looking for a new car. Similarly, if you’re shopping for a new car, don’t rule out used ones. There may be situations in which a new car might be a better value than a used car, or vice versa. Keep your options open to find the perfect vehicle for you.
- Get the most for your trade-in. Since the market is up, that means your current vehicle is also worth more. This can help soften the blow from the higher selling prices. If you’re trading in your vehicle, it could go a long way toward a newer, higher-priced vehicle.
When you’re ready to purchase your next new or used vehicle, be sure to get pre-approved before you visit the dealer to lock-in a great, low rate and save time once the price negotiations are done. For a limited time, we’re offering up to $500 cash back and no payments ’til 2022 on any vehicle financed through 12/15/21. You can also sign your loan paperwork from your phone or tablet the same day with our eSign capability. Apply today.
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