OCEAN SPRINGS, MS (WLOX) - When it comes to buying a car these days, old habits may be changing. The sale of used cars is on the rise, and prices for those cars are going up as well.
At Elite Auto Brokers, Allen Holder goes over the books for the day. Signs outside try to entice buyers to stop by for a look. It appears to be working these days. The recession and the resulting tighter credit has played a role in the surge of used car sales, according to Holder.
"In the secondary lending business, yes sir, I think a used car is easier to buy because of the price and the amount that you are going to finance on a car. It's easier to get the money."
New car dealers, who also sell used, are seeing the same thing. At Mandal's in Ocean Springs, Chris Handler and his co-workers map out the days sales strategy. A 2009 federal stimulus program, Cash for Clunkers, took 700,000 cars out of the market.
"You had a bunch of people come in at one time and trade in a massive amount of vehicles at one time," Handler said. "It boosted the economy quick, but you don't get a long term effect out of that because you took so many people that were three years out of the market."
Clay Johnson has been selling used cars for years. He knows the law of supply and demand is clearly at play.
"You don't necessarily have that many more people that are buying used cars, but you have less used cars available for those people. And the prices have been steadily going up, actually the last couple of years," Johnson said.
There are many reasons more and more Americans are choosing to buy used cars. Shorter term financing and lower taxes on car tags are just a couple. But Holder believes there's one outstanding reason why more people are choosing used vehicles.
"Oh, I would have to think it was price. If you walk into a new car dealership, not everybody can buy a new car. And with used cars, it's going to be a price thing."
In 2009, 12 million new vehicles were sold in the U.S., while 41 million used cars traded hands. The average price of a new car is $28,000. The average sale price of a used car is just over $8,000.