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Leverage the Market: Maximize Your Car's Sale Price

Written By

Lewis C. Smith

Published

Jun 11, 2023

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Discover how to leverage the competitive car market to maximize your car's sale price. Gain insights on selling or trading in your car effectively.

Know the Market: You're Selling Either Way

Whether you're trading in your vehicle during the purchase of another or selling it outright to a dealership, you're still selling your car. Today, many dealerships such as CarMax, Carvana, and others in the U.S. offer the same price for your car, irrespective of whether you're buying another from them or not. This presents an opportunity to leverage differences in the market to your advantage.

Sophisticated Arbitrage: A Practical Perspective

Sophisticated Arbitrage: A Practical Perspective

Given that dealerships use similar market data to value used cars, common vehicles should have approximately the same value across different dealers. The reality, however, may surprise you. For this in-depth analysis, we'll use a 2017 Honda CR-V, a common and easily-valued vehicle, to demonstrate the potential differences in offers.

The Experiment: Selling a 2017 Honda CR-V

Honda CR-V is a popular car, selling over 377,895 new units in the U.S. in 2017. They are easy to value because of the straightforward model trims that do not have many variable options. So, theoretically, dealership offers should be very close. Let's see what happens in practice.

Navigating the Offers: Some Surprising Findings

In our examination of the 2017 Honda CR-V, we were consistent across all vehicle conditions and rated the car as being in near or indeed excellent condition. No exterior scratches or mechanical issues, no fluid leaks, no interior markings, and no accident history were noted. The tires were assumed to have less than 10,000 miles, and we included the availability of two keys. With these specifications in mind, we visited each website, filled out their vehicle questionnaires, and collected the different offers from each organization. Notably, all offers were solicited within a one-hour timeframe and used the same zip code as well as the same Vehicle Identification Number (VIN) for consistency.

The organizations from which we received offers included AutoNation, CarMax, Carvana, Driveway, Driveo, Shift, and Vroom. We also considered offers from non-dealer entities such as Kelley Blue Book Instant Cash Offer and TrueCar.

Vroom emerged with the highest offer, proposing a value of $22,922 for the CR-V. The other offers we received, listed in descending order, were $22,859, $22,200, $22,150, $21,251, $20,550, and $18,400. Meanwhile, non-dealer platforms Kelley Blue Book Instant Cash Offer and TrueCar provided offers that fell within this range. All these offers were made on the basis of the Honda CR-V's year, make, model, mileage, and condition being confirmed.

Understanding the Value Discrepancies: Beauty is in the Eye of the Beholder

The variety in offers for such a common vehicle is intriguing and underscores the importance of the adage "value is in the eye of the beholder." It's clear that some dealers like Vroom, Driveway, and Shift see more potential in the same vehicle than others.

Final Thoughts: Maximize Your Car’s Sale Price and Making Smart Decisions

In just a little over an hour, you can gain a comprehensive understanding of the market for your vehicle. The key here is to not only look for the highest offer but to consider the reliability and trustworthiness of the offer as well.

While the highest offer might seem like the best choice initially, there's a caveat to consider. During the inspection process, where the dealership verifies the year, make, model, trim, mileage, and condition of your car, the offer can be revised downward. If this revised offer doesn't make much sense to you, remember, you have options. Use the market to your advantage and move on to your next best offer.

It's worth mentioning that offers from non-dealer entities like Kelley Blue Book Instant Cash Offer and TrueCar are slightly different in nature. These entities give an offer that's contingent upon inspection by a dealer in their network. While they expect the dealers in their network to honor the offer, this scenario is different from getting an offer directly from a dealer.

Your advantage here lies in understanding these differences and leveraging the competitive market to maximize the sale price of your vehicle. By doing your homework, understanding the nuances of the market, and using this knowledge to your advantage, you can add a significant amount to your pocket when selling or trading in your car.

There are typically local options as well and this is where, for California residents, the CarOracle Auto Buying Program can be helpful, where a licensed auto broker, who follows the market, can offer guidance on which avenues would be worthwhile to pursue to maximize the value of your vehicle.

Trade-Ins & Selling your Car FAQs

What are some tips for negotiating the best trade-in or selling price for my vehicle?

Before you start negotiations, have a clear understanding of your vehicle's market value using online tools. Keep your car clean and well-maintained, as a good first impression can increase its perceived value. When negotiating, don’t be afraid to walk away if the offer isn't what you want – there are always other dealers or buyers. And finally, remember to have all your paperwork organized, including maintenance records, which can add to the perceived value of the car.

What are some tips for negotiating the best trade-in or selling price for my vehicle?

Before you start negotiations, have a clear understanding of your vehicle's market value using online tools. Keep your car clean and well-maintained, as a good first impression can increase its perceived value. When negotiating, don’t be afraid to walk away if the offer isn't what you want – there are always other dealers or buyers. And finally, remember to have all your paperwork organized, including maintenance records, which can add to the perceived value of the car.

What are some tips for negotiating the best trade-in or selling price for my vehicle?

Before you start negotiations, have a clear understanding of your vehicle's market value using online tools. Keep your car clean and well-maintained, as a good first impression can increase its perceived value. When negotiating, don’t be afraid to walk away if the offer isn't what you want – there are always other dealers or buyers. And finally, remember to have all your paperwork organized, including maintenance records, which can add to the perceived value of the car.

If I want to sell my car to another private party, what should I consider?

When selling your car privately, it's crucial to price it correctly. Use valuation tools like Kelley Blue Book or Edmunds to get an estimate of your car's value. Prepare the car for sale by cleaning it thoroughly and considering small repairs that might increase its appeal. Also, make sure to have all necessary documents such as the title, service records, and a bill of sale. If there is an outstanding loan on the vehicle, this adds some complexity, as you won't have the title to sign over until the loan is paid off. If possible, working with a local bank where the loan is held could help in managing the payoff and title transfer process. Keep in mind that selling privately often takes longer than selling to a dealer and involves more coordination and negotiation with potential buyers.

If I want to sell my car to another private party, what should I consider?

When selling your car privately, it's crucial to price it correctly. Use valuation tools like Kelley Blue Book or Edmunds to get an estimate of your car's value. Prepare the car for sale by cleaning it thoroughly and considering small repairs that might increase its appeal. Also, make sure to have all necessary documents such as the title, service records, and a bill of sale. If there is an outstanding loan on the vehicle, this adds some complexity, as you won't have the title to sign over until the loan is paid off. If possible, working with a local bank where the loan is held could help in managing the payoff and title transfer process. Keep in mind that selling privately often takes longer than selling to a dealer and involves more coordination and negotiation with potential buyers.

If I want to sell my car to another private party, what should I consider?

When selling your car privately, it's crucial to price it correctly. Use valuation tools like Kelley Blue Book or Edmunds to get an estimate of your car's value. Prepare the car for sale by cleaning it thoroughly and considering small repairs that might increase its appeal. Also, make sure to have all necessary documents such as the title, service records, and a bill of sale. If there is an outstanding loan on the vehicle, this adds some complexity, as you won't have the title to sign over until the loan is paid off. If possible, working with a local bank where the loan is held could help in managing the payoff and title transfer process. Keep in mind that selling privately often takes longer than selling to a dealer and involves more coordination and negotiation with potential buyers.

What is Kelley Blue Book's Instant Cash Offer, and is it good?

Kelley Blue Book's Instant Cash Offer is a service where you can get an online quote for your car, which is valid for three days. This offer is based on information you provide about the car's condition and features, and it's validated by an inspection at a participating dealer. Kelley Blue Book serves as a middle-man in this process, as the transaction happens directly with a dealer who has enrolled in this service. It's a helpful tool to benchmark your car's value, but remember, the final offer could be different based on the dealer's physical inspection.

What is Kelley Blue Book's Instant Cash Offer, and is it good?

Kelley Blue Book's Instant Cash Offer is a service where you can get an online quote for your car, which is valid for three days. This offer is based on information you provide about the car's condition and features, and it's validated by an inspection at a participating dealer. Kelley Blue Book serves as a middle-man in this process, as the transaction happens directly with a dealer who has enrolled in this service. It's a helpful tool to benchmark your car's value, but remember, the final offer could be different based on the dealer's physical inspection.

What is Kelley Blue Book's Instant Cash Offer, and is it good?

Kelley Blue Book's Instant Cash Offer is a service where you can get an online quote for your car, which is valid for three days. This offer is based on information you provide about the car's condition and features, and it's validated by an inspection at a participating dealer. Kelley Blue Book serves as a middle-man in this process, as the transaction happens directly with a dealer who has enrolled in this service. It's a helpful tool to benchmark your car's value, but remember, the final offer could be different based on the dealer's physical inspection.

How does Kelley Blue Book and Black Book come up with their trade-in values?

Kelley Blue Book and Black Book determine trade-in values using extensive data gathered from wholesale auctions, dealer sales, and rental companies. They take into account factors like the vehicle's age, mileage, overall condition, equipment levels, and the current demand and supply for that particular make and model in the market. Wholesale auction data is a foundational element in their valuations as it's standardized and provides accurate details of the vehicle condition, making it easier for their algorithms to determine market factors. However, keep in mind that these are estimates, and actual trade-in offers can vary based on the individual dealer's interest in your vehicle.

How does Kelley Blue Book and Black Book come up with their trade-in values?

Kelley Blue Book and Black Book determine trade-in values using extensive data gathered from wholesale auctions, dealer sales, and rental companies. They take into account factors like the vehicle's age, mileage, overall condition, equipment levels, and the current demand and supply for that particular make and model in the market. Wholesale auction data is a foundational element in their valuations as it's standardized and provides accurate details of the vehicle condition, making it easier for their algorithms to determine market factors. However, keep in mind that these are estimates, and actual trade-in offers can vary based on the individual dealer's interest in your vehicle.

How does Kelley Blue Book and Black Book come up with their trade-in values?

Kelley Blue Book and Black Book determine trade-in values using extensive data gathered from wholesale auctions, dealer sales, and rental companies. They take into account factors like the vehicle's age, mileage, overall condition, equipment levels, and the current demand and supply for that particular make and model in the market. Wholesale auction data is a foundational element in their valuations as it's standardized and provides accurate details of the vehicle condition, making it easier for their algorithms to determine market factors. However, keep in mind that these are estimates, and actual trade-in offers can vary based on the individual dealer's interest in your vehicle.

What is a vehicle trade-in vs. selling it directly to a dealer?

A vehicle trade-in occurs when you're buying a new or used vehicle from a dealership and you give your current vehicle to the dealership as part of the payment. The dealership will appraise your vehicle and deduct this from the price of the new or used vehicle you're purchasing. This is often an easier path if there is an outstanding loan on the vehicle, as dealerships are accustomed to working through loan payoffs and handling title transfers.

Selling your vehicle directly to a dealer, on the other hand, means you're simply selling yours without buying another. The key advantage is that you can shop around and take the best offer, as your vehicle may be more desirable to some dealers than others. However, in states like Arizona where sales tax is only paid on the difference between the trade-in and the vehicle purchase price, selling directly could mean missing out on this tax advantage.

What is a vehicle trade-in vs. selling it directly to a dealer?

A vehicle trade-in occurs when you're buying a new or used vehicle from a dealership and you give your current vehicle to the dealership as part of the payment. The dealership will appraise your vehicle and deduct this from the price of the new or used vehicle you're purchasing. This is often an easier path if there is an outstanding loan on the vehicle, as dealerships are accustomed to working through loan payoffs and handling title transfers.

Selling your vehicle directly to a dealer, on the other hand, means you're simply selling yours without buying another. The key advantage is that you can shop around and take the best offer, as your vehicle may be more desirable to some dealers than others. However, in states like Arizona where sales tax is only paid on the difference between the trade-in and the vehicle purchase price, selling directly could mean missing out on this tax advantage.

What is a vehicle trade-in vs. selling it directly to a dealer?

A vehicle trade-in occurs when you're buying a new or used vehicle from a dealership and you give your current vehicle to the dealership as part of the payment. The dealership will appraise your vehicle and deduct this from the price of the new or used vehicle you're purchasing. This is often an easier path if there is an outstanding loan on the vehicle, as dealerships are accustomed to working through loan payoffs and handling title transfers.

Selling your vehicle directly to a dealer, on the other hand, means you're simply selling yours without buying another. The key advantage is that you can shop around and take the best offer, as your vehicle may be more desirable to some dealers than others. However, in states like Arizona where sales tax is only paid on the difference between the trade-in and the vehicle purchase price, selling directly could mean missing out on this tax advantage.

Dive Even Deeper into Trade-Ins & Selling your Car

Dive Even Deeper into Trade-Ins & Selling your Car

Dive Even Deeper into Trade-Ins & Selling your Car

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CarOracle is a California-licensed automotive dealer, License No: 43082, with an autobroker's endorsement, enabling us to represent consumers in the purchase or leasing of new and used vehicles.

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CarOracle is a California-licensed automotive dealer, License No: 43082, with an autobroker's endorsement, enabling us to represent consumers in the purchase or leasing of new and used vehicles.

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CarOracle is a California-licensed automotive dealer, License No: 43082, with an autobroker's endorsement, enabling us to represent consumers in the purchase or leasing of new and used vehicles.

©2024 CarOracle. All rights reserved

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CarOracle is a California-licensed automotive dealer, License No: 43082, with an autobroker's endorsement, enabling us to represent consumers in the purchase or leasing of new and used vehicles.

©2024 CarOracle. All rights reserved

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