I noticed the same thing a few months ago when my son was looking for a car. I think that people are holding on to their old cars and not buying new which is driving up the used car market.

My theory was the 1999/2000 changeover is still messing with folks and people aren't logically grasping that the mid 90s were a long time ago.

what octothorpe said.

people have abandoned the new car market and swarmed the used car market.

Which kind of sucks, I know, but there's not a whole lot you can do but be assertive and persistent.

I see what Kelly's saying though too. People think "1999" and it seems not so long ago for some reason, when in fact 1999-model cars were built 10 or more years ago!

My son ended up buying a '96 Mazda MX-6 which seems to be working out for him. He paid $1500 for it but it needed some exhaust work which cost another $400 which I paid for. But yea, it's a 13 year old car.

I think my snapping point was seeing my model and year car (96 cavalier)- the car my mechanic just told me "get rid of it, it's too old to dump more money into" on there for $3995. That's nearly half of what it sold for new!
I can see with imports, or higher end cars, but there are people selling econobox cars for like 40% of their original price. It's madness!

That's about the going rate down here in Nowhere, SC as well. Plus, as octothorpe says, expect to sink a bit more cash in it, especially if you live in an exhaust inspection area. The year and model do not matter; if it runs halfway decent, it is going to cost at least 2 grand. The junkyard near me is hauling cars out, piecing them back together, and selling 3 or 4 a week out of their parking lot.

The year and model do not matter; if it runs halfway decent, it is going to cost at least 2 grand.

So, if it works reasonably well for 10-20 mile daily commutes 90% of the time, it's two grand?

Shit. That sucks, man.

Yeah, those are pretty good numbers, j_p. Plus, the extra maintenance especially if it's the original engine and transmission. You are going to have stay on top of regular oil changes and fluid levels. I will only buy used from here on, and I am budgeting to trade-in every four years.

You might find a better car for the price in some 20k town way out in the middle of nowhere since most of the cars you find in metro area used car lots are bought at auction, cast off from dealership trade-ins for not being good enough to keep in their own used inventory. YMMV

Here's how the ball bounces.

1. People were buying big new cars by using their house as an ATM. Home equity loan = "free" Hummer. And why not? Their house was suddenly worth twice a Hummer more than they bought it for.

2. No more HELOCs. In fact, almost no more credit, period, unless you have a super FICO. This has shrunk the number of people who CAN buy a new car even if they wanted to by some enormous, unheard-of amount, like 50% or more.

3. People who must buy a car are going used. People who are just thinking about cutting back spending are going used. This has increased demand for used cars by some enormous, unheard-of amount.

4. At the same time, people who would have bought a new car are not putting their used car on the market. This shrinks the supply of used cars.

It's really put pressure on used-car prices. Good for sellers, not as good for buyers.

Tried police auctions?

We bought a new car last year (Nissan Versa). At this time in our lives we're putting half the average kilometres per year on it*. Between that and regular maintenance we should have it a long, long time.

*It's due for it's 9 month/18,000 km check up (appt. is Saturday). It has less than 8,000 km on it now.