Purchasing a new or used car is a major expense. The pricing fluctuates throughout the year, so timing your car buying strategically unlocks significant savings opportunities. Aligning your deal with seasonal clearance events, updated models, and peak incentives will help you score the absolute lowest price with maximum value. This comprehensive guide examines the optimum opportunities in both the new and used car market.

How New Car Prices and Incentives Fluctuate

New car pricing follows predictable annual cycles timed around releasing new model-year vehicles:

Early Fall – 2020 model year cars start hitting dealerships. Prior year models see price cuts up to 20% off MSRP as Inventory clears out.

October-November – Deepest discounts on remaining new 2019 model year vehicles, including 0% APR financing deals before interest rates reset in January.

January-February – Mild deals on 2020 models before spring sales kick-off. Interest rates bump slightly higher at the start of the new year.

March-April – Custom rebates aimed at moving specific models off the lot before fuller summer sales. Look for bonus cash on SUVs, and trucks.

May-June – Memorial Day kickstarts summer sales push with stacked incentives. Discounts reach 10-15% off MSRP on 2020 vehicles.

July-August – 4th of July and model year-end clearances Offer the next best savings behind December deals. Up to 20% off outgoing models along with low financing rates.

December – Dealerships aim to clear outgoing 2020 inventory to make room for 2021 models. Huge rebates and incentives approaching holidays.

Planning based on this seasonal ebb-and-flow of pricing helps you buy when values dip lowest.

How Used Car Prices Shift During the Year

Used car pricing also fluctuates predictably at key intervals:

January-February – Prices hit annual lows due to slow winter sales. Dealers offer enticing clearance promotions to move aging inventory off the lot sooner.

March-April – Values trend upward as tax refund season sparks car shopping. Increased demand reduces supply and bargaining power. Avoid overpaying.

May-August – Values hold steady with balanced supply and demand through the peak summer driving season. Steer clear of high-markup dealer models and negotiate private seller prices down.

September-October – Pricing eases downward again as dealerships take in an influx of off-lease vehicle returns. More supply benefits buyers in the fall.

November-December – Wholesale auctions flood with model-year sell-offs, translating to clearance deals at dealerships before new inventory arrives.

Buy used when supply outweighs demand during the quieter late winter and fall months for the biggest year-round savings.

Top New Car Buying Holidays and Events

Certain holiday weekends spur automaker incentives and exceptional bargains:

Presidents’ Day Weekend

• February offers winter clearance sales with some of the steepest discounts of the year nearing 25% off MSRP.
• Prior model year cars see huge price cuts before new inventory arrives.
• Low APR financing deals emerge on remaining 2019 vehicles.

Memorial Day Weekend

• Deep summer sales kick off with May’s big holiday weekend.
• Discounts off 2020 models reach 10-15% as dealerships clear lots for the coming year’s releases.
• Manufacturers roll out bonus cash rebates up to $ 5,000+ on select outgoing models.

4th of July Weekend

• July 4th is an ideal time to score deals as demand lulls between Memorial Day and Labor Day sales.
• Look for aggressive incentives on 2020 model-year cars as the 2021s start hitting the pipeline.
• Possible to negotiate the year’s lowest prices outside of peak December clearance events.

Labor Day Weekend

• Dealerships are motivated to sell outgoing model year cars at big discounts before all-new 2021s arrive in September.
• The remaining 2020 inventory will see sizable price cuts and stacked rebates.
• Popular models like trucks see inventory shortages, so shop early for the best selection.

Year-End Holidays

• Thanksgiving through New Year is peak deal season, with December offering the optimal year-round savings.
• Massive rebates and incentives as dealerships aim to clear outgoing stock before the new model year arrives in January.
• Huge discounts approaching 20-25% off MSRP on select 2019 models still on the lot nearing winter.

Align your next new car purchase with major federal holiday weekends and you’ll score exceptionally low prices along with bonus incentives.

How End-of-Model Year Sales Cut New Car Costs

The transition between outgoing and upcoming model years brings valuable buying opportunities:

August & September – As the next model year vehicles launch in the fall, prices start dropping on remaining old stock. Watch for incentives of up to 20% off MSRP on 2019 cars.

October & November – Dealerships motivated to sell every last 2019 model still occupying the lot before yearend. Shop late-year models for huge savings.

December – The last month of the year sees peak bargains on the previous model year as next year’s inventory arrives. Haggle an extra 5-10% off clearance prices.

January & February – Wrap up model year closeout deals in winter. Old year new cars are in short supply but offer the steepest discounts you’ll find all year, especially on luxury models.

March & April – Pickings slim for leftover old-year cars but check for lingering inventory.2020 models are now firmly established with milder discounts.

Monitoring showroom inventory and incentives during the fall and winter transition months will help you snag the deepest savings as dealerships slash outgoing model prices.

Best Incentive Offers to Target

In addition to holiday and year-end sales, auto companies dangle enticing incentive offers at key intervals:

0% APR Financing – Zero interest financing pops up near the end of model years in summer and winter to move inventory. Enables buying down interest rates substantially if you have good credit.

Customer Cash Rebates – Look for bonus cash offers targeted at specific models experiencing lagging sales. Gives dealers motivation to bargain.

Lease Pull-Ahead Offers – Manufacturers entice lessees into early turn-ins by offering lease pull-ahead deals to migrate you into a new car.

Conquest Offers – Transitioning from a competitor’s model to their brand earns conquest rebates around $1000 or more.

Demo Vehicle Discounts – Ask to buy leftover new dealer demo models after model changeover for savings of up to 20% off retail.

Military & First Responder Rebates – Many automakers offer exclusive discounts for active duty, veterans, police, firefighters, and EMTs.

Timing your purchase around manufacturer incentives stacks savings on top of normal discounts.

Buying a Used Car: Monthly Trends

Used car prices fluctuate every month. Historical used car pricing trends reveal the optimal buy times:

January – Used car values bottom out coming off slow winter sales. Dealers offer clearance deals on aged inventory.

February & March – Pricing remains low before tax season sparks demand. Inventory is higher than in other months.

April & May – Values trend upward as tax refunds fuel car shopping. Avoid overpaying this in-demand season.

June to August – Prices hold steady during peak summer driving months. Competitively shop similar models to land a fair price.

September & October – Pricing eases downward as off-lease cars flood dealer lots. Negotiate lower as supply expands.

November & December – Wholesale sell-offs at auctions bring deals. Dealers discount aging inventory before new stock arrives.

Tip: Avoid buying used cars around March when values spike. Focus efforts in winter and fall instead.

Aligning your used car search properly with monthly supply and demand cycles makes a significant impact on the price paid.

How Mileage and Age Influence Used Car Prices

Two key factors impact used pricing – vehicle age and mileage accumulated:

1 to 3-Year-Old Vehicles

• Low mileage examples with less than 40,000 miles in this age range hold the highest values but offer nice savings over new.
• High mileage models will be discounted but have accelerated wear.

4 to 6-Year-Old Vehicles

• Around 70,000 – 100,000 miles, well-maintained examples hit the used market at substantial discounts.
• Higher mileage versions over 100k miles start developing major repair needs. Avoid.

7 to 10-Year-Old Vehicles

• Prices bottom out as cars enter the 100,000 mile and up range. But repair frequency also rises.
• Best suited for budget buyers willing to accept higher maintenance.

Over 10-Year-Old Vehicles

• Depreciation slows after 10 years, but critical component failures become likely.
• Only practical for DIYers capable of handling repairs or as project/classic cars.

Target cars in the prime 4-6-year-old range with lower than average mileage to maximize remaining life and value.

How to Time the Used Car Market Cycles

Optimizing your used car purchase involves aligning with broader market supply-and-demand cycles:

Peak Market (March-May)

• High asking prices and diminished inventory during the spring shopping boom. Avoid unless you locate an underpriced listing.

Cooling Market (June-August)

• Balanced car supply steadies prices through summer. Dealers order new trade-in inventory.

Buyer’s Market (Sept-Nov)

• High vehicle availability returns leverage to buyers with more selection and lower prices as off-lease cars enter the used market.

Off-Season Market (Dec-Feb)

• Showrooms packed with old inventory pull prices down further through winter months. Dealers offer clearance promotions.

Consulting used car market indicators helps you time your purchase to periods favoring buyer power and savings.

Strategies for Buying a Used Car Privately

Beyond dealers, purchasing directly from a private owner unlocks considerable savings if you follow key tips:

Check Listings Daily – New private seller deals appear online every day. Checking frequently raises the odds of finding underpriced gems.

Consider Out-of-State Sale Listings – Expand your ZIP code search for more options and pricing variances regionally.

Email Sellers with Cash Offers – Make lower cash offers to motivated sellers highlighting the convenience benefit. Cash saves them listing and marketing time.

Avoid High-Emotion Sellers – Overly attached or pushy owners often over-inflated value. Focus on finding indifferent sellers.

Inspect Thoroughly – Hire an independent mechanic to identify issues before finalizing a private party purchase.

Check Vehicle History – Run a vehicle history report using the VIN to verify no major damage, title problems, or odometer fraud.

Meet Sellers Locally – If buying long distance, coordinate a local prepurchase inspection through a service like Lemon Squad.

Exercising smart negotiation tactics and thorough vetting gives you an advantage when buying privately.

Closing Thoughts

The peaks and valleys of the annual new and used car market cycles present distinct opportunities to capture major savings if you time purchases intelligently. By monitoring incentives, inspecting inventory, and exploiting short-term shifts in supply and demand, you can hone in on lightly used models, upcoming redesigns, and outgoing models for the year’s lowest prices. Patience to hold out for ideal invoice pricing and incentive stacking ultimately pays dividends. Use the seasonal trends and strategies outlined as your guide to unlocking the best car deal.