The shift matters because many shoppers who once turned to used vehicles as the cheaper option are now facing higher prices there as well. New car costs, tariffs, inflation, limited supply, and the age of vehicles on the road are all part of the picture.
According to the latest intelligence report from CarGurus, the average used car price is now $30,200. That is more than $3,000 higher than the $27,171 average reported around the same time last year.
Used Car Prices Are Rising After A Short Break
The average used car price has increased by 11% compared with last year. According to the latest report from CarGurus, used car prices overall are running 5.1% higher year over year.
This marks a return to pricing levels not seen since 2023. At that time, the auto industry was still dealing with the effects of the pandemic and shipping disruptions, including the Ever Given blockage in 2021.
Those disruptions pushed some buyers who would normally have purchased new vehicles into the used market instead. Demand rose, and prices followed. Once market conditions became more stable, used car prices declined, reaching an average of $27,171 last year.
More Inventory, But Not Cheaper Inventory
There is one positive sign, used car inventories are building up again. Still, the available supply is not necessarily helping buyers looking for cheaper options.
The current inventory includes more “younger” used vehicles. These are newer used cars, and they tend to cost more than older models.
That detail helps explain why a larger inventory does not automatically mean lower prices. More vehicles may be available, but many of them are still relatively expensive.
Tariffs, Older Cars, And Fewer Affordable Models Are Adding Pressure
Rising prices are not tied to one single factor. Tariffs and inflation are part of the issue, especially because tariffs have added costs to new cars and imported car parts.
Kelley Blue Book also points to another pressure: people are keeping their cars longer. The average age of a vehicle on the road is now 12.8 years.
KBB also notes that there are fewer cars available to buy or sell, partly because automakers reduced production after the 2008 recession. As a result, used car prices now sit largely between $15,000 and $30,000, making cheaper options harder to find unless the buyer is mechanically inclined.
The new car market is putting more pressure on used prices as well. KBB reports that in five years, the number of vehicles priced at $25,000 or less has dropped by 78%. Today, only four new models are offered at that price, compared with 36 models six years ago. At the other end of the market, there are now 114 new models priced above $60,000, nearly twice the number seen in 2017.
For used car shoppers, the result is clear enough: even the secondhand market is becoming harder to enter at a lower price.
