It's been known that when you leave the lot of a car dealership with a new car, the value of the car depreciates immediately. However, in today's car market the tables have turned in the favor of used car owners.

According to the U.S. Department of Labor statistics, used car prices are up nearly 40% from last year. New cars are only up by 12%.

Ivan Drury, Edmunds' senior manager of insights, said we have got to this place because of a depletion of inventory and microchips, and COVID-19 protocols on assembly lines.

"We are seeing that virtually every single used car and we're talking about one year old, three year old, nine year old cars are up in value," Drury said. "We're just at this point where people can't get what they want and even if you do order a new car today, you're going to have to wait and it might not even be fully equipped in the manner in which your accustomed to because it might be missing a chip or two for certain options."

Drury also said in today's car market, it's better to buy a car than to lease one, as lease payments are expensive currently and comparable to the cost of buying a car.

Here are some tips that he gave on negotiating:

1. Shop your existing vehicle to as many outlets as possible
   
2.  Shop around for the best interest rate
   
3. Be confident
   
4. Do you research to find out the market rate
   
5. Research addons for your desired vehicle
   
6. Look over your purchase contract to learn important common auto terms
   
7. Compare your trade in value with different outlets
   
8. Separate your wants from your needs
   

Drury said it's important to find out what the deals are available at dealerships, the published and unpublished ones.

"Ask the dealer what are the incentive programs available or go to the automakers website because they publish these incentives," Drury said. "...They adjust these incentive programs every single for sales day of the month. So, be aware. And if you're looking at holidays, this is the one where people think you actually have to buy on that holiday, that's really not the case it's the same incentives throughout the entire month."

Support WITF: https://www.witf.org/support/give-now/

See omnystudio.com/listener for privacy information.