I've got 7 months left on my 19 CX-5 GT Lease. I was going to upgrade and buy a used 2020 Signature at the end of a lease to avoid the depreciation hit. I'm a "Car Guy" this is my 28th car over 36 years (typically owned 2 cars at a time), 2nd lease. The only other lease I did was on an Acura TL-S Sedan and ended up buying it at the end of the lease, immediately listed it on Auto Trader and pocketed $3,500 profit. This time around I only did the Lease to keep the payments down as my credit took a hit after divorce so a purchase, the payments were just a little too high to stomach plus you save on sales tax is you don't purchase the car at the end anyway. My credit is 120 higher no than it was 2.5 years ago (750 versus 630).

I started doing a little research recently and my 19 GT in mint condition (inside and out) with only 20,800 miles (I work from home, even pre-COVID) dealers are asking $500 under the price I paid new (which was $250 over invoice.) I know typically the Dealers will advertise a high-ball price on their used cards and will come down 5-10%. But it seems post-COVID the used market prices have gone completely INSANE! Am I right in what I'm seeing?

So then I started thinking, why not buy the car (current buy out price is $24,400) now, and trade it in on a 2021 Reserve when I *should* be able to get a pretty penny on the trade price? The question though is are they not dealing on the new price due to chip shortage so it's all amounts to a wash basically and I'm better off waiting until the end of the year when things have cooled down? I doubt there will be any end of model year deals on the 2021's though if there's a shortage to begin with and maybe the used market will be cooled down in 7 months so I can pickup a 2020 used for a reasonable price but my gut is telling me that may not be the case. Plus I really need a larger screen. My long vision is great but I'm having a hard time sometimes reading my Android Auto Screen on my 19.

Wondering what other people's recent experience/observations/recommendations are?

 

I can buy a CX-5 for under invoice here in FL. My trade was $6000 more than what I paid for it!!! If I were you, buy out your lease...sell your current GT and buy a new 21 and walk away with an amazing deal. Anyone that doesn't take advantage of this crazy used car market is crazy IMPO. You can still find great deals on NEW vehicles

 

Really!? When did you buy the CX-5 and what year/model did you trade?

 

Because the pickup market is so insane right now based on the semiconductor shortage, dealers are offering crazy money for used trucks. My truck was only 6 months old and I got just over $6000 more than I paid for it back in December. I am a truck guy, but my wife and I decided a small SUV may be a great interim vehicle until the truck market normalizes. I looked at the CX-5 and the Subaru Forester. I have a friend who is the GM at a Subaru dealer and sold it to me under invoice versus MSRP that most vehicles are getting now for most all new car sales. Mazda was willing to sell me a CX-5 for invoice, but since this is only a temp vehicle, I chose the Subaru over the Mazda and put an additional $6300 in the bank. I am going to wait until 2023 and then buy another truck as Subaru's retain their value better than most all other vehicles and, based on my deal, I may break even or take a minimal loss. In addition, FL is a state where your trade goes 100% towards sales tax so I paid ZERO sales tax on the Subaru. Regardless of what you own, you should go to Carvana and Vroom to get a quick quote on what they will buy your vehicle for and, if necessary, use that as leverage to get more from a local dealer which is exactly what I did. I really wanted the CX-5, but it wasn't worth another $6300 when I know it will be traded in the Spring of 2023.

 

I just did exactly what you are proposing in May. Had a '19 GT which was leased until 6/22. I was able to get the lease paid off with a bit extra on top and buy a new '21 GTR at a discount. Happy camper here. I could have waited to see what happened in 22 but I figured why wait when it won't be a different car next year and I don't know what the market will be like at that time. As said by securityguy above- my 2020 Nissan Frontier SV is also worth way more than I paid for it in 9/20 (I am not selling it though). Really crazy used prices right now with the chip shortage.

 

@securityguy Ahh, it's the truck that is the key. Sounds like the chip shortage is affecting the American models more than foreign, especially trucks?

@chickdr19 Your story is encouraging as it is very similar to my situation. What was the discount off MSRP (or price above INVOICE) they gave you on your 2021 GTR and what area of the country?

So I had to take my car in for service a couple days ago. When I picked it up, I thought what the heck, I'll stop in at the showroom and see what numbers they'll give me. I cringe at dealing with Car Salespeople. They always treat you as the average Joe who doesn't know their games. I usually just go direct to the Fleet Sales Manager or through a buying service like Checkbook's Car Bargains (NOT a referral service like TrueCar or Costco Auto). It saves time and they keep your contact info anonymous so you don't get bombarded with a chain of texts and emails for weeks. They can't get trade prices for you though.

So I stop in, tell him the situation and that I'd like to get some numbers to see if the timing is right. They examined the car and gave me a $25K trade price. I'm guessing the REAL trade price is more around $26K and they are just low balling me. They are advertising the car for almost $30K and probably taking $28000-$28500 so $2000-$2500 is reasonable profit for them. He also of course asked how much I owe on the car, they always do, and I always reply, that's completely irrelevant to the trade in value. If you want to give me $1 million for my trade, I'll pay $1 million 30 thousand for the new car.

But when I asked for the new price he quoted me MSRP. LMAO. I said thanks and started to walk away. The #1 rule of negotiation is he who names a price first, loses and these guys follow that rule usually. And if they do name a price, it's always a highball. Once you start to walk then things start happening. The problem is the salesperson really doesn't have the authority to give you the "real" price and they work on commission so they have no incentive to get you the lowest price except just to improve their units sold numbers. But I was already there so even though I rarely deal in-person, I decided to see what would happen. Then the CLASSIC question comes up "So what would it take for you to buy the car today?" I told him, I don't have enough information yet to answer that question. You are my first dealer I've inquired with. I would be stupid and irresponsible to pull the trigger without collecting more data points. I might have said, give me $27000 on my trade and $200 over invoice on the 2021 like I paid for my 2019 but I had no idea if $27K was still leaving money on the table, probably not. Even though I could see their lot had about 25+ brand new CX-5's he of course claimed they weren't discounting much off MSRP due to the chip shortage. At this point, the time is money factor comes in and my gut told me any more time with these guys is a dead end in this circumstance. I also love it how they ask for your keys and then keep them as sort of a way to dissuade you from immediately walking. It's so hilarious after all these years most dealers use the same old tactics, mainly because there is always going to be a high enough percentage of inexperienced and/or unknowledgeable buyers that walk in that they can make more profit on. I really respect the "no haggle" dealers - not very many of them - that give you their bottom line price, online. The other dealers have to hate that but it still usually isn't the price you can get from the Fleet Sales Manager as they operate more on volume targets than commission like the showroom people do.

The other thing is on the trade many bring their numbers in, like a printout from KBB and/or Edmunds. They always tell you, we don't use those numbers. They either use NADA or Blackbook. I've found Blackbook to be the closest to what their real bottom line is on the trade in. But you have to hunt for free sites that use Blackbook as it's a paid service. I think the NADA consumer gives different numbers than the NADA dealer site anyway. But I bring both so when they tell me which one, I have the printout for that service. I did check beforehand but couldn't remember off the top of my head. Since then I verified intelliprice.com is showing the Black Book on this car at $23,875 - $27,875. So in mint condition, my gut was right that $27K is the more fair trade than $25K. This dealer couldn't compete when I was shopping for the 2019 price so I wasn't expecting them to have good numbers. They are in a fairly high economic demographic area in the Seattle area so they are probably used to high net-worth clients with low car knowledge who don't care if they left $1-$3K on the table when buying a $35K car. They just want to get the sale over with.

 

@Jazee ...great write up my friend. I buy two new cars every 1.5-2 years and have since I was 25. I am on my 39th vehicle now. I STRONGLY recommend that you go to both Carvana and Vroom and enter your license plate and state...then answer a few simple questions and you will instantly get a very accurate quote on what your car is really worth as they don't play games like local dealers. You can then use those numbers as leverage when shopping your trade.

 

I went to Carvana and got a quote for about what I paid for a 2016 Scion iA when I bought it new after tax, title and fees. Five years of a car for the kids for free. Unfortunately, we need it for 2 more years.

Every once in a while, the markets go crazy and the lucky ones are able to profit. In 2011 with the hurricane in Japan, I was able to trade in a Sonata with 32,000 miles for a 1,200 loss. In 1985, Mazda trucks were cheep. The dealerships were assigned 2 cars for every truck they sold during the quotas. I paid 7,000 for my first new Mazda and I think the sticker was 10,000.

Dealerships are out of both new and used cars. I would not expect a good deal on a new car. There may still be a few deals out there but I don’t expect them to last long.

 

There are still great deals on new cars for invoice or less. You just have to shop and make things happen! I found several CX-5s for under invoice…and that’s just one example😉

 

I did the same thing. Checked Carvana and got an offer right at my lease payoff (pristine 19 GT PP with 20k miles). I called my dealer and asked if they could match the price. They beat it by a bit and had the exact GTR I wanted in stock. At first they told me MSRP due to the shortage. I said I wouldn't pay MSRP for a car so late in it's life cycle. I offered 35k. They accepted. I took the 0.9 financing as well. If I didn't do the financing it would have been 34k. Invoice for my car was 36k.