Ah, good old supply and demand. Or call it the circle of car-buying life: As the economy remains in less than full health and lenders remain scarce, car owners are hanging onto their old models longer. Fewer new car sales, in turn, mean fewer late-model trade-ins, which means the supply of used models on the lot is decreased. (Let's not forget that rental agencies, hurting like everyone else, are hanging onto their models for longer, as well.) Of course, with less money floating around, those who do need a vehicle are more likely to turn to a used car -- and with that demand, used-car prices are skyrocketing. USA Today quotes this example:
"[Used car prices are] so high that at Gerald Jones Honda in Augusta, Ga., owner Andy Jones paid $6,000 at auction for a 2004 Buick Century with 70,000 miles that he fixed to sell for $8,500 -- more than three times what a car like that would have been worth before the recession hit, Automotive News reports. Prices have become so out-of-control that some dealers have stopped buying cars at auction -- and it won't stop there. New car sales are expected to be low again this year, though they are projected to outpace last year, at least.
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