According to ADESA Canada, the country's largest wholesale auction source for dealers, used vehicle prices are on the way down.
ADESA's Used Vehicle Price Index, which reflects the seasonally-adjusted composite value of all used vehicle segments, fell by almost 1% during each of July and August, after a year of relative stability.
The summer price drop was spread broadly across all vehicle segments, with mid-size cars and SUVs experiencing the greatest decline. Compact SUVs were the only class of vehicles to maintain their July price levels and full-size pickups showed only a small drop.
Used vehicle prices have been on an upward trend for about four years, in part because of the tight supply of trade-in and off-lease vehicles, resulting from the new vehicle sales collapse of 2009-2010.
Used vehicle supply is closely related to the level of new vehicle sales three to four years earlier. With new vehicle sales increasing rapidly over that period, industry analysts predict that used vehicle prices will continue to decline over the next three or four years – perhaps by as much as 4% by 2017 – which is good news for buyers.