“CAN YOU HELP ME BUY A USED CAR FOR LESS THAN $5,000?”
We have heard this question from Esprit Motors customers several times. They know that we purchase cars from wholesale auctions for customers as a service (called auto brokerage) and that we sell refurbished vehicles that meet our high standards. Unfortunately, finding a car for $5,000 these days is much harder than ever before. We put together some advice for car buyers on how to buy a used car for less than $5000.
Why is it so hard to buy a car right now?
If you have tried to purchase a car lately, you know that finding what you are looking for is harder than ever before. Also, when you find a vehicle that fits your specifications, the price seems higher than expected.
The same thing is going on with the used car wholesale market. It is hard for dealers to find cars right now, and that lack of supply causes wholesale car prices to be higher because more dealers are competing to purchase fewer vehicles.
Purchasing a car on Craigslist on your own from a private seller is also difficult right now for the same reasons. Prices seem high, and there are not many cars to purchase. We think this is caused by several reasons, including that people are holding onto their vehicles longer, choosing not to upgrade their cars as frequently, or even switching from gasoline-powered to electric vehicles. Local market conditions have a significant effect on Craiglist and its hyper-local marketplace.
What does $5k get you in today’s market (late 2022)
In the Portland metro area, a typical $5,000 car right now:
- It has around 200,000 miles or more on the odometer
- It is at least 15 years old
- It has body damage (either from an accident or from wear and tear on the vehicle)
- It most likely has an expensive repair that will need to be fixed in the next few months
“Can I hire you to buy a $5k car for me??“
Unfortunately, it is not feasible for us to do this for customers. We can only offer to buy cars as a broker that are between three and five years old.
However, we occasionally offer for sale cars between $5,000 and $8,000. Those cars do sell very quickly. These cars tend to be cars that we took in as a trade-in or were found during our normal inventory search.
What we suggest that you do instead
Our advice is that if you want to buy a used car for $5,000, then this is really a time to take to Craigslist or Facebook Marketplace and turn it into your personal project.
Here are some tips:
Most cars at the $5,000 price point will be older (obviously), have more than the average number of miles, and might also be a make, model, or body style that is not popular in your area.
These cars might also have cosmetic issues that would cost a significant amount to fix, but do not impact how the car runs and drives.
Sometimes cars for sale for $5,000 (from a private party seller) are cars that the seller needs to sell quickly. The seller will get a lot of responses from potential buyers when the cars are posted on Craigslist, Facebook Marketplace, or eBay. Because the seller is going to receive a lot of potential buyers contacting them, a buyer needs to drop everything and go look at the car (and be ready to leave a deposit) as soon as possible.
Sometimes cars that are offered for less than Kelly Blue Book or at a lower price point can be found outside of a metro area or at a place that is difficult to get to (yes, oh the irony). While it might be a great car, the seller is not going to get as many potential customers that are willing to drive out to a location far from a metro area. With less competition, the price of the car will be softer. You might be able to get a good deal this way.
What we do offer
If you are interested in learning more about how we can help you buy a car that is between three and five years old using our auto broker service, please send us an email at ian (at) espritmotors (dot) com.