Wholesale used car prices rose 5.3% year over year in the first half of March. That's according to Cox Automotive's Manheim Used Vehicle Value Index, which hit 213.4 with auction conversion rates at 70.2%, up 5.5 points from a year ago. Dealers are buying aggressively. Supply is tightening. And the spring selling season hasn't even started in earnest.
If you're shopping for a used car right now, the market is working against you. But the reasons why are worth understanding, because they point to where the opportunities still exist.
New car tariffs are pushing buyers into used
The average transaction price for a new vehicle hit $49,353 in February, per Kelley Blue Book. That's up 3.4% year over year. The average MSRP has been above $50,000 for 11 consecutive months.
Tariffs are a major reason. The current rate is 25% on vehicles built outside the US, with 15% on cars imported from Europe, South Korea, and Japan. Automakers absorbed some of those costs through 2025, eating into margins rather than raising sticker prices. That's over. Toyota reported a 25% decline in net income for the first nine months of fiscal 2026, citing roughly $8 billion in tariff-related losses. Other manufacturers are in similar positions.
KBB analysts expect at least a 5% price increase on vehicles not subject to the full 25% tariff. For the ones that are, expect more.
The downstream effect on used cars is straightforward. More people are getting priced out of new and landing on used. The average new car payment was $772 in Q4 2025, per Edmunds. Used was $570. Total monthly ownership cost (loan, insurance, fuel, maintenance combined) went from about $750 in 2019 to over $1,000 today, according to Cox Automotive's chief economist.
This isn't the same dynamic as the COVID-era price spike, when new car inventory vanished and drove used prices up. This time, new inventory exists. It's the price that's pushing people over. And that creates a different kind of demand pressure on the used market: steady, structural, and unlikely to reverse until tariff policy changes.
The sub-$15K market is the tightest segment
Overall used car inventory sits at about 49 days of supply. Cars priced under $15,000? Thirty-six days. That's 13 days below the market average, per Cox Automotive data reported by CNBC.
"Affordable under-$20,000 vehicles are harder to find," said Jonathan Banks, VP at J.D. Power.
The average used car listing price was $25,287 in February, per CARFAX. That's down 1.1% from January. But zoom out and the picture shifts. The average price of a used car up to 8 years old hit $30,202 in 2025, up 27.6% from $23,668 in 2020, according to J.D. Power.
More off-lease vehicles should enter the market through 2026, which will help supply in the $20K to $30K range. The sub-$15K segment won't see much of that relief. Those cars age into the bracket slowly, and the pipeline is thin.
Research firm iSeeCars projects that popular used models could see price increases ranging from $890 to $5,169 if the current tariff environment holds and demand continues to shift from new to used.
Tax refund season is adding fuel
March and April are historically the highest-demand months for used car purchases, and this year's boost could be bigger than usual. Average tax refunds are running 11% higher than last year, per Cox Automotive.
That money flows directly into down payments. Spring typically pushes used car prices 10% to 20% above winter lows. Combine that with the tariff-driven demand migration from new to used, and you get the wholesale price movement showing up at Manheim auctions right now.
Wholesale supply has tightened to 25 days, per Manheim's mid-March data. When dealers pay more at auction, retail prices follow within weeks.
What to do if you're buying now
The numbers are clear: prices are elevated, demand is strong, and the spring selling season will push them higher before it cools them down. Waiting for a dramatic drop isn't a strategy the data supports.
That doesn't mean you pay whatever a dealer posts. It means your negotiating power comes from information, not timing.
Know what a specific car is worth before you show up. Check how long it's been listed. A vehicle sitting for 40+ days gives you more negotiating room than one that arrived last week. Look at wholesale price trends for the exact make, model, and year you're targeting. Broad averages won't help you when you're standing in front of a specific car with a specific price tag.
CarScout's market pages track real pricing data by make and model, updated from live listings. When you know what a car should cost at the trim and mileage level, you negotiate from a position the dealer respects.
The people finding good deals in this market aren't browsing more listings. They're using data to move faster and negotiate smarter than the next buyer.