Along with the mud, the muck and the hardship that Hurricane
Sandy left in her wake comes another unwelcome gift: higher
used-car prices. The storm wrecked some 250,000 consumer vehicles.
As drivers replace them, used-car prices could rise nationwide.
Kiplinger's Auto Buying Guide
Sandy didn't skip over new-car lots; major dealers reported
thousands of lost vehicles. But used-car losses are greater, and
inventories were already strained. In recent years, people have
been buying fewer new cars, resulting in fewer trade-ins. So an
uptick in demand in a short period points to price hikes for
Expect to pay about $700 to $1,000 more, on average, at
least through February
, says Lacey Plache, chief economist for Edmunds.com, with bump-ups
most likely in the Northeast. Because used-car prices were trending
lower seasonally before the storm, prices may remain stable when
they would otherwise have fallen. But tax-refund season is
typically strong for used-car sales, so don't look for prices to
fall again until midyear, says economist Tom Kontos, at consultant
Adesa Analytical Services.
A bigger problem will be a torrent of flood-damaged cars
hitting the market.
Title work might not reflect a run-in with Sandy. A free scan from
will tell you if a vehicle has been registered or titled within the
past 12 months in storm-affected areas; CarFax is offering
. Look for signs of water, mud or rust in unusual places and pay
close attention to electrical wiring. Be suspicious of deals that
are too good to be true.
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This article first appeared in
Kiplinger's Personal Finance
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