by F Sneneh, Chicago Auto Insurance Specialist
Worst time to buy used cars from car dealers
Tax return filing starts in February and does not end till mid April. Many people schedule their major purchases during that time because they expect to get some income tax refund. One of the major purchases that people plan for during the tax season is the purchase of vehicles.
Used cars purchased at used car dealerships are normally sold at higher prices during that seasons for two reasons:
Used car dealers in Chicago start stocking up their inventory from right after Christmas time. The prices that dealers pay at auctions for vehicles go up as dealers compete among themselves to get cars. If the cost is high, retail price offered to the clients must also be high.
More demand on used cars lead automatically to higher retail price. This is a fundamental economic theory. Higher demands lead to higher prices.
Higher demand along with higher cost will make it almost guaranteed that people who shop for used cars from used car dealers dealership end up paying much higher prices, compared to those who purchase cars during different time.
Best Time to Purchase Used Cars
Best times to purchase a used vehicle from car dealers are:
The weeks preceding Christmas when neither dealers not clients are seeking to purchase vehicles, and when everyone else is worried about Christmas shopping, not car shopping.
Immediately after tax season, when dealers are buying less from auctions (resulting in lower auction prices) and when people exhausted their tax refund, leaving dealers with stock of cars that must go to free some cash for the dealers.
Effect of tax season on car insurance rates
There is no reason to believe that the timing of your used car has anything to do with the premium you pay for your auto insurance. The normal factors affecting auto insurance rates are garaging address, credit, age, gender, marital status and driving record. The time you buy insurance is irrelevant.