(NewsNation Now) — Used car lots are awash with new car prices.
As prices for used vehicles blow past any seemingly rational level, it is the kind of scenario playing out at many auto dealerships across the country. Prices have soared so high, so fast, that buyers are being increasingly priced out of the market.
A new report found the average price for a used car is up about 40% compared to a year ago, according to Edmunds.com.
The average monthly price for a used car is $520. This factors in down payment, interest rates and the price of the vehicle.
This means more than half of America’s households now have less income than is considered necessary to buy the average-priced used vehicle.
There are empty parking spaces in many new car lots, which is pushing up the prices of used vehicles.
The microchip shortage since the start of the pandemic goes hand in hand with the price spike, and has driven the demand for more used vehicles because new cars just aren’t being built.
Since March of 2020, used car prices are up 42%. Dealerships and owners don’t have to come down off current asking prices because the demand is so high.
That puts the average price of a new car at over $29,000.
So if you have a budget for a car purchase, you are likely going to have to buy one that has more miles on it or is much older than you originally desired.
Experts are torn on when this price spike will ease. Some say 2023, others say it could be 2024 before car prices level out.