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Most cars that I've seen for sale, either privately owned or from the dealer, are priced thousands of dollars above the KBB value. I understand KBB and real market value is different, but in some cases the cars are not in demand or that popular. For ex. I was looking at a 03 Legacy, guy wanted 5k when KBB value was closer to 2500. Another ex. a Suzuki Sidekick was selling for $4k, KBB value $1500..are people not reasonable or is KBB outdated?
Values listed in KBB, as well as NADA and Edmunds, are supposed to reflect actual market value for year/make/model/condition/mileage. I would expect a lot of sellers to list inflated prices, to allow some negotiating room, but 2X + listed values are unrealistic, even if they are selling an immaculate cream puff.
Personally, I wouldn't pay more than book value. I know people will tell you "you can't go by those books", but if there is total loss of the vehicle, my experience has been that insurance companies will rely heavily on values listed in guides like NADA, and likely won't compensate you for additional amounts you paid over value when you bought it. Honestly, the values listed in some of those guides can be a little high, IMO.
For a dealer... its obvious... they just want to make as much as possible
As for a private seller, it can be the same as above, but I assume some can be attributed to personal attachment. Many think that their car is better than others and worth more.
If I were selling a car there is no way I would list it at the KBB price. I fully expect the buyer to negotiate and I'll price high to give me room to work with. Saying "that's the price" is easy, but it turns off many buyers so I'd rather dicker a bit and get the sale done.
Most cars that I've seen for sale, either privately owned or from the dealer, are priced thousands of dollars above the KBB value. I understand KBB and real market value is different, but in some cases the cars are not in demand or that popular. For ex. I was looking at a 03 Legacy, guy wanted 5k when KBB value was closer to 2500. Another ex. a Suzuki Sidekick was selling for $4k, KBB value $1500..are people not reasonable or is KBB outdated?
Got a neighbor down the street who is trying to get $12,500 out of his 2000 Excursion with the 5.4V8 & 150,000 miles. He didn't think it was funny when I told him that Blue Book is about $6500. Not surprisingly, it's still for sale.
Moral of the story: People tend to think that their own crap doesn't stink.
The books rely on real data. The more Data they have, the more accurate they are. So, if you are looking for an outlier, the books aren't as good. If you're looking for an '05 Camry with 96,000-110,000 miles, it should give you a pretty good idea. That Subaru or Suzuki could be an outlier, depending on mileage and condition, or there could be so few of them around that the books don't mean as much. AWD/4WD demand a premium in the winter, Minivans demand a premium in the spring and early summer, and fuel sippers demand a premium whenever gas spikes. Garage Logic's neighbor is toking something at $12,500, but he may well get above book value because you don't find many Excursions out there.
Also, people get emotional about the car. They think theirs doesn't stink. So, some people aren't reasonable.
Good clean used vehicles are in demand nowadays so people price them accordingly. Some limited popular models demand more money.
Everyone knows the dickering routine so therefore the high prices.
It's the same when overlisting a house for sale. Everyone wants to dicker down the price.
Because KBB hasn't adjusted for all the lost inventory due to Cash for Clunkers. All used car prices are higher than they were five years ago, but KBB still depreciates on the same linear scale (age x mileage).
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