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