Buying used is a great way to avoid depreciation, but the average used car cost more in March than it did a month before.
According to the Manheim Used Vehicle Value Index, strong retail demand for used vehicles have increased prices of used cars and trucks in April, going against market expectations. Dealer sales of used vehicles rose four percent last month and two percent over the first four months of the year. In addition, the Manheim Index revealed that seven publicly traded dealership groups collectively increased their sales of used cars and trucks by over 10 percent in the first quarter of 2014.
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The index stood at 124.9 last month, up from 124.4 in March and 119.2 compared to April 2013. The April 2014 index reading is the highest since May 2012, where it read 125.1.
The Manheim index is adjusted for vehicle make, model and time of year and was started in January, 1995 at 100. Also contributing to overall used-vehicle supply and higher prices is a lower volume of retired rental units sold by rental companies at auctions last month.