Used-car prices are rising faster than overall inflation after crossing the $30,000-mark again early this year

The main driver of today’s elevated used car prices is tight supply. Edmunds reported that the average trade-in vehicle in the first quarter of 2025 was 7.6 years old — the oldest since 2019. That means fewer late-model trade-ins and lease returns are reaching the used market, shrinking the pool of “near-new” options.

With limited low-mileage inventory available, competition among buyers remains intense, especially for popular models, which helps keep prices elevated. Tariffs add another wrinkle: while used cars themselves aren’t taxed, higher new-car prices caused by tariffs are pushing more shoppers into the used market as a cheaper alternative.

Market dynamics are also slowing. In Q1, the average used vehicle sat on a dealer’s lot for 38 days before selling — the longest stretch since early 2021. The slower turnover reflects caution on both sides: dealers are reluctant to cut prices in a supply-constrained market, while buyers are taking longer to find the right fit.

For consumers, whether to buy now or wait depends on need. Those who must purchase should temper expectations — deep discounts are unlikely — and focus on reliable, well-maintained models. More inventory could arrive later in 2025 as new vehicle production stabilizes and trade-ins increase, potentially easing some of the pricing pressure.