It's been a tough summer for car shoppers looking for a great deal on a car. Inventory on both new and used vehicles has been in low supply due to factory and dealership closures from the COVID-19 pandemic, but the good news is that prices are starting to drop on new models. Initial shipments of 2021 models are starting to hit dealership lots, which means dealers will start discounting 2020 models to make way for the next model year.
At the same time, Edmunds analysts are seeing trade-in values sharply increase, which could make your car deal even better.
What you need to know
Edmunds recommends focusing on 2020 models for better deals. Our data reveals that the average discount for 2020 model year vehicles climbed to $3,111 in August, compared to $2,968 in July and $2,845 in June.
Used vehicle prices remain high, but that's good news for those with a trade-in. The average list price for a 3-year-old vehicle climbed to $24,287 in August, up $721 from July and up nearly $1,500 from June.
This unseasonal increase in used prices presents a unique opportunity for consumers with a trade-in who are looking to purchase a new car this holiday weekend because they could get hundreds or even thousands more for their vehicle.
September will likely be the best time to take advantage of the robust trade-in prices. Since many leases are set to expire in October or November, the supply of used cars should increase toward the end of the year and put downward pressure on trade-in values.
Intrigued? Head over to our appraisal tool to see how much your car is worth. If your vehicle qualifies, you'll get an instant offer good for seven days, which you can redeem at a participating dealer or take to another to help bolster your trade-in negotiation. We've also rounded up a selection of big discounts, 0% APR financing deals and special lease offers to help Labor Day shoppers save even more. Check it out — a new set of wheels might be more attainable than you thought.