A BUYER'S MARKET?

After four years of skyrocketing prices amid scarce supply, the new and used car market appears to now be favouring buyers. Experts say it all depends on the vehicle you want

- LEAH GOLOB

Car prices are starting to drop after record high costs during the pandemic, yet experts are mixed on whether the tide’s turned from a seller’s market into a buyer’s market.

When the COVID-19 pandemic hit in 2020, car manufacturers paused orders expecting demand to dramatically decline, which did happen, says Baris Akyurek, vice-president of insights and intelligence at Autotrader, an online marketplace for car buyers and sellers.

But, once summer rolled around, consumer demand for vehicles jumped, in part, since fewer people wanted to use public transportation and ride-sharing services. This supply and demand mismatch led prices to skyrocket, Akyurek says.

We’re almost back to 2019 inventory levels when it comes to new cars, Akyurek says, but it will depend exactly on what car you’re looking for.

“If you ask me what happened to the new car inventory situation, we do not have a situation anymore. There’s lots of new cars in the market, so new car availability, at the high level, is good.”

AutoTrader.ca’s June 2024 Price Index reports a 70.4 per cent year-over-year increase in new vehicle inventory and a 28.2 per cent year-over-year increase for used.

The average cost of a new car is now $66,812, down 0.7 per cent year-over-year and a used car is $36,075, down 8.7 per cent yearover-year, according to AutoTrader’s July data.

New car interest rates from the lending arm of automotive manufacturers are also down from 6.2 per cent in November 2023 to 5.3 per cent in June 2024, the report says.

With the arrival of new inventory on the lots, pent-up demand is now being met, Akyruek says.