Affordable auto financing has vehicle prices rising
Posted on Wednesday, September 4, 2013 at 1:03:05 PM
More people are taking advantage of affordable auto financing rates in order to purchase new vehicles, and prices are reflecting the growing buyer demand.
A recent report from automotive pricing information company TrueCar illustrated the increasing figures, stating that the average transaction price for a light vehicle in August was $31,252. That sets a new record, and is more than 3 percent higher year-over-year.
The good sales numbers were in part driven by several major manufacturers, including Chrysler, Ford and Honda, among others. Additionally, the highest transaction price change belonged to Volkswagen, with an uptick of more than 2 percent.
One of the main reasons for the changes is because of cost-effective automotive financing, and more people are finding that now is an ideal time to buy a vehicle.
"Historically low interest rates as well as very attractive lease specials fueled by high resale values are enabling consumers to buy more expensive vehicles while still keeping payments at affordable levels," explained TrueCar senior analyst Jesse Toprak. "It's good day at the office for the manufacturers when the sales continue to grow double digits while transaction prices reach record highs."
In addition, lenders are more willing to provide loans for subprime borrowers, with a 27.4 percent market share for nonprime, subprime and deep-subprime new vehicle loans, according to Experian Automotive. The automotive climate appears to be improving, making ownership a distinct possibility for many.