The Best Time to Buy a Car: Part 1
There are a lot of stories around about the best time to buy a car. Some of these stories are true, but most fit into the category of urban myth. Some of the ones that aren’t true, or at least don’t have any actual research to back them up, are:
Myth # 1: The best time to buy a car is in the afternoon when the salesperson is sleepy.
Myth # 2: You will get a better deal on a car on a rainy day.
Myth # 3: There are better days of the week to buy because the dealership is slower on those days.
While there is ongoing speculation about the above myths, there are some things about timing your car purchase which we know to be true. They are:
Tax Time = Bad for Buyers
Steven Lang, who runs a car auction house and dealership in the Atlanta area and contributes to TheTruthAboutCars.com, explains that the used car market presents some great opportunities for sellers around the time that most Americans are receiving tax refunds. So obviously this is not the best time to be buying a used car:
“From mid-February through early June, the auto industry goes through an event called tax season," says Lang. "Folks receive their refund checks from the IRS, which in turn creates a nice little bubble of activity in the used-car industry.”
Lang’s auction house tracks the trends in sales, and he has noted that cars sell for between $700 and $1500 more on average than their market value.
End of the Month
There is a popular perception that the end of the month might be a good time to buy a car because dealerships need to meet a certain quota for the month and so are prepared to do a good deal. Phil Reed is the Senior Consumer Advice Editor for Edmunds.com. He says:
"There's some truth to the idea that new-car dealers may make better deals at the end of the month. But people shouldn't think that a little tip like that alone will get them a great deal."
Manufacturers often have some kind of incentive system in place such as excess stock clearouts or financing deals, and usually these run out at the end of a given month. This is what makes car dealers more likely to do a good deal around that time – they want to make the most of the incentive from the manufacturer while it lasts.
One of the problems with tips like the end of the month one is that the more people who believe it, the more will be waiting until the end of the month, creating more demand at that time and actually pushing prices up. For this reason it’s important to keep an eye on what incentives different manufacturers are offering and when they run out, then try to use that information as leverage when timing your purchase.
Stay tuned for part 2 of our report on the best time to buy a car, where we’ll talk about unpopular bargains, world events, and timing your purchase based on the market. In the meantime check out some of our handy tools and resources for buying a car. There might be a great bargain right under your nose.