As we roll into May 2025, the used car market is heating up — and fast. Between rising prices, a shortage of low-mileage vehicles, and renewed demand driven by economic uncertainty, it’s officially a seller’s market. But that doesn’t mean buyers are out of luck. Here’s what’s driving the shift, how used car prices are trending, and what shoppers can do to stay ahead of the game this summer.

Why Used Car Prices Are Rising Again

CarEdge’s own Ray Shefska recently checked how much his 2020 MINI Clubman was worth on the used market. Just six weeks after receiving a $16,600 offer, that same car was valued at $19,000 — a 15% increase in value. While Ray’s experience may sound extreme, it perfectly illustrates the broader trends driving up used car prices this spring.

So what’s going on? Several forces are converging this spring to push prices higher:

1. Used car demand is rising. Auto tariffs and fears of continued inflation have consumers acting fast. Many shoppers are buying now to avoid potentially higher prices later.
   
2. Seasonality is back. Warmer weather has always brought car buyers out in droves — and this year is no different. Think of it as the “spring rush” for cars, a trend that skipped only one year in recent memory: 2020.
   
3. The chip shortage echo. The pandemic-era production slump from 2021–2022 wiped out about 15 million new vehicles. Four years later, that shortfall is hitting the used market hard. With fewer gently-used cars in circulation, buyers are competing for a smaller pool of desirable inventory.

One result? The average age of a used car for sale is now 6.7 years — a 26% increase from 2020, when the average was just 5.3 years according to Manheim. However, many buyers still prefer a more gently-used vehicle, so younger pre-owned cars are selling for a steep premium in 2025.

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Average Used Car Prices Are Back on the Rise

After peaking above $28,000 in 2022, average used car prices dipped to just under $25,000. But now, prices are bouncing back.

Cox Automotive reports that the supply of used cars under $15,000 — often the most in-demand by budget-conscious buyers — is at its lowest level since 2021. These affordable vehicles are also selling the fastest.

Wholesale price data from Black Book shows that used car values are up 2.75% over the past two months — but that’s just the average. Zoom in on the most desirable vehicles, and the price increases are even sharper.

Younger Used Cars Are Gaining Value Fastest

Vehicles that are 0 to 2 years old are appreciating much faster than older cars. Buyers have caught on to the sharp depreciation that hits new cars as soon as they leave the lot — and they’re now prioritizing lightly-used vehicles instead.

That’s creating a perfect storm: low supply, high demand, and rapidly climbing prices for newer used cars. Meanwhile, older vehicles — especially those over 6 years old — are either holding steady or even losing value.

The takeaway? The younger the used car, the stronger its market value right now.

We track used car prices weekly here. Add this to your bookmarks if you’re in the market!

What This Means for Sellers

If you’re thinking about selling a car that’s less than five years old — especially one with low mileage — now is the time. Dealers and private buyers are paying top dollar for clean, late-model vehicles.

• The average used car sells with about 70,000 miles on the odometer. If yours has under 30,000 miles, it’s a standout — and worth a serious premium.
  
• The hottest vehicles on the market are 2021–2024 models with clean histories and relatively low mileage.

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It’s Officially a Seller’s Market — But Smart Buyers Can Still Win

Yes, prices are rising. But used car shoppers still have a chance to land a great deal — especially if new car incentives dry up due to tariff pressures or reduced inventory. Here’s how to stay ahead:

✅ Find Aging Inventory

Use CarEdge Car Search to locate used cars that have sat on dealer lots the longest. These units are often the most negotiable.

✅ Know How to Negotiate

Arm yourself with free negotiation cheatsheets and walk into the dealership with confidence. A well-informed buyer is a powerful buyer.

✅ Don’t Skip the Inspection

A pre-purchase inspection can save you thousands down the road. It’s your best defense against buying a lemon.

✅ Be Flexible

Keep your options open. If one deal falls through or a dealer won’t budge on price, move on. Also, don’t get talked into paying for overpriced add-ons or junk fees. Here’s what’s legit, and what’s a ripoff.

✅ Use a Car Buying Expert

Feeling overwhelmed? Let a professional handle the hard part. CarEdge’s Car Buying Service offers expert help — and now features our most affordable option ever.

Final Thoughts

The 2025 used car market is undergoing rapid changes heading into May. Values are rising, inventory is tightening, and shoppers are rushing to lock in deals before prices rise further. Whether you’re selling a low-mileage car for top dollar or hunting for a well-priced used vehicle, the key is to do your homework, whether you’re buying or selling.