Prices All Over the Map
Alyssa Sandner of San Rafael, California, sold her 2014 Subaru Impreza to Carvana in December 2020, before prices really jumped. “It was so easy. It was wild,” she says. She didn’t accept the first offer before it expired in seven days. When she went back a week or two later, the price had dropped by $500 to about $11,000. That was below the trade-in value but still reasonable, so she took it.
“They scheduled a time to pick it up. They came with a flatbed truck, I handed over the paperwork, the money was in my bank account the next day,” she says. “I think I would have gotten a couple thousand more in a private-party sale, but I didn’t have the energy or time.”
Tom O’Farrell sold his 2016 GMC Terrain with one dent to Carvana in October 2021 for $19,700. That was about $3,500 more than one dealership offered him on a trade-in and $5,000 more than another one offered. “I was stunned,” he says. Carvana came to his home near Annapolis, Maryland, the next day. He signed some papers and handed over the title and keys. A few hours later, the car was gone. The money was in his account the next day.
To test it out, I requested offers for a 2012 Toyota Rav4 base model with about 68,000 miles to all six companies in February 2022. The car had been in one hit-and-run accident. Their offers, from high to low, were $11,000 (CarMax), $10,800 (Kelly Blue Book), $9,521 (Carvana), $8,122 (Vroom), and $7,875 (TrueCar). Shift’s estimate was $11,500, but it didn’t ask about accidents.
According to Kelley Blue Book’s valuation tool (which did not ask about accidents), the car’s estimated value was about $10,000 to $11,200 on a trade-in or $11,500 to $13,040 in a private-party sale.
Online offers vary because “everyone has certain cars they are after” for resale, says Joseph Clark, TrueCar’s used car business manager. “If you were to put in 100 different cars, we [would] have some where we are the top offer, some where we are in the middle.”
Historically, dealers have preferred used cars that were three to five years old, because they are still financeable but wouldn’t compete with new cars on their lots, Clark explained. But since the Covid-19 pandemic has disrupted the supply of new cars, some dealers have been snapping up one- to three-year-old cars.
Newer companies such as Carvana “are trying to get their name out there; they are in some cases overpaying,” Montoya says.
If you have a 10-year-old car with 100,000 miles, you’re not likely to get the best offer online. “For those types, you definitely want to try to sell it on your own,” says Car and Driver’s Dorian.
Once the pandemic subsides and new cars become more plentiful, used-car prices will come down, Dorian predicts, but online buyers will still offer more than brick-and-mortar dealers, simply because their overhead is lower.
No matter how you sell your car, make sure you promptly file a form with your state motor vehicle department that notifies it of the sale and releases you from liability if the vehicle is used in a crime, involved in an accident, ticketed, or abandoned.