Those planning to buy a car should think twice. While prices have started to decline from the August 2022 peak, they are still inflated by demand outpacing supply.
“We are still in a seller’s market,” notes Benoit Béland, from the site AutoHebdo.netwhich published its state of the market on Monday.
Of the 350,000 cars for sale on the site, 80% are used, a category where the average price in Quebec was $33,551 at the end of last year. It was $29,434 at the end of 2021 and $16,988 at the end of 2020.
“The good news is that inventories are expected to increase in 2023, which will drive prices down,” the spokesperson said.
Since last July, the average price of a used car has fallen by approximately 1% per month in Quebec, which is little compared to the increase of almost 100% since 2020.
Demand is still strong, says AutoHedbo.net. In January, the site experienced a 27% increase in traffic and a 35% jump in requests for information from sellers.
Avoid buying this year
The average price of new cars is also up sharply in Quebec. It was $55,660 at the end of 2022, compared to $45,975 at the end of 2021 and $33,630 at the end of 2020.
“The waiting time in the new is still counted in months and even in years”, also observes George Iny, of the Association for the protection of motorists (APA).
Above all, buyers’ ability to pay has not been the same since the multiple interest rate hikes, especially for people who have had to renew their mortgage or who will soon have to do so.
His advice: don’t buy a car this year, if possible.
“Last year, it was a paradise for sellers in the spring and a disaster for buyers,” notes the one who first wants to help poor people and middle-class consumers.
Beware of car debt
Stocks aren’t growing that fast, he notes. Prices will remain high, he said.
Another problem, notes Guillaume Eckerl, “is that we now see people who bought a car during the price peak and who resell it with a debt”.
The founder of Peachy Car, a company that supports individuals in the sale of used cars, gives the example of a car paid for 15,000 dollars and resold for 11,500 dollars.
“Debt follows the car, not the owner,” he warns, so make sure the loan is paid off when buying a used car.
The Register of Personal and Movable Real Rights is there for that, says the expert, but “not everyone knows that”.
AVERAGE PRICE OF A CAR IN QUEBEC *
2020 : 16 988 $
2021 : 29 434 $
2022 : 33 551 $
2020 : 33 630 $
2021 : 45 975 $
2022 : 55 660 $
* As of December 31 of each year
Source : AutoHebdo.net