If you have stayed tuned to the news in the last month, you probably know Hurricane Sandy has caused damage across the east coast in the billion-dollar range.
For the sake of transparency, LCM Used Car Center near Lancaster PA would like to take a minute and discuss the toll market analysts are predicting Hurricane Sandy will have on used car dealerships and buyers on the east coast.
Due to thousands of used cars totaled in the storm, supply is, at best, less than ideal. Conversely, demand for used cars in states hit by the hurricane is significantly up… Individual storm victims and companies with fleets need to replace displaced vehicles and they don't necessarily want to buy new.
You don't need to be an economist to know that this presents an environment in which costs will rise. As far as when they'll be at their highest, Jonathan Banks, Executive Automotive Analyst, NADA Used Car Auto Guide explains, "The loss of used-vehicle supply and the increase in replacement demand after Hurricane Sandy will have the greatest impact on used-vehicle prices in December."1
How much are used cars prices expected to rise on the east coast?
The National Automobile Dealers Association is forecasting 0.5-1.5 percent!
We understand this does not come as good news to used car buyers. Trust us. We're not happy about it either. However, we're hopeful that understanding the reasoning behind the short-term increase will help to soften the blow. And, it's really not as bad as it could be…
If you look back to four months after Hurricane Katrina struck in in 2005, used car prices increased approximately 3 percent. Roughly $309 per car, that's a hike that really hurts.
To learn more about the impact of Hurricane Sandy on the used car market on the east coast, be sure to stay tuned. We're dedicated to keeping you informed on everything from do-it-yourself used car maintenance tips to outstanding, seasonal used car auto financing options.
Source: 1 http://blogs.cars.com/kickingtires/2012/11/experts-used-car-prices-to-rise-in-wake-of-hurricane-sandy.html
