Thinking of unloading a four or five year old car? It's the best time in years to trade it in, unless you are driving a big gas guzzling SUV, which are not in demand right now.
The reason: high gas prices coupled with the Japanese earthquake have created a shortage of used economy cars.
Drivers Thrilled by News
Samantha LaBarbara watches what she spends on gas and groceries these days. So she was thrilled to learn that her small car is worth a lot more now than it was a year ago.
LaBarbara said, "It's like 10 years old, so I think that's real encouraging, to know I could get a better value for it."
Kelly Blue Book says this is a great time to trade in a small to midsize car, saying dealers are paying 25-percent more than last year for high demand models.
For instance, a 2008 Ford Focus with 35,000 miles was worth:
- $7,500 last spring on trade-in.
- $9,600 this year.
A 2008 Hyundai Elantra, same 35,000 miles:
- $9,300 on trade-in last year.
- $10,700 this year.
Dealers Fight for Small Cars
Car dealer Gary Heflin says he now has to fight for small cars at auto auctions.
Heflin said, "Every time a small car comes in, a Hyundai, Kia, Ford, a crowd comes around the cars. There's not a small car that a crowd's not around, and the bidding starts."
What this means is that if you're thinking of unloading a smaller sedan, this is the best time in years to sell or trade it in.
But for the same reason, some drivers won't do it. Joyce Robinson won't give up her tiny Toyota's great fuel economy. She said, "It's great! I feel great going to the gas station when everyone else is paying 80 bucks and I'm getting out for 30."
With prices so high on small used cars, the AP says in some cases -- such as a Honda Civic or Accord -- leasing a brand new car may be cheaper than buying a 2-year-old model.
So dont expect a bargain on a used small car, and shop around, so you don't waste your money.
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