By love-89.com As car prices and insurance rates continue to climb, a recent report from Edmunds reveals that 73% of consumers are adopting a wait-and-see approach before making a purchase. With the rising costs associated with buying and maintaining a vehicle, many are hoping for a decrease in prices.
Interestingly, 48% of respondents expressed a desire for new car prices to fall below $35,000, while 14% are aiming for prices under $20,000. Additionally, a significant portion—one-third—would prefer auto loan interest rates to stay between 0% and 3%, with three-quarters hoping they won’t exceed 5%.
According to a report from FOX Business, vehicles from before 2020 are priced at least 20% lower than the average cost of $47,000 for 2024 models. Edmunds also notes that most buyers would like to see used cars priced under $15,000.
Another factor contributing to consumer hesitation is the cost of vehicle ownership. The American Automobile Association (AAA) has recently highlighted its 2024 driving cost study, stating that owning a car will cost an average of $12,297 annually, translating to about $1,024 per month—an increase of $115 from 2023.
The rising depreciation rates of vehicles and economic concerns are the primary reasons for the hesitance to purchase new cars. However, popular models like the Chevrolet Trax, starting at just $20,000, seem to attract buyers despite the broader market trends.
The increasing cost of insurance is another aspect affecting car buying budgets. FOX Business reports that due to the rising expenses associated with repairs and taxes, auto insurance rates, which have already seen a spike in 2024, are expected to climb even further.
Data from the Bureau of Labor Statistics (BLS) indicates that auto insurance premiums have surged by 22.2% in 2024, a change only slightly less than the historic 22.4% increase following the oil crisis in 1976. Various factors suggest that insurance rates are likely to continue increasing, further complicating the decision-making process for potential car buyers.