With prices of used vehicles soaring, now is the best time to sell your car - if you have one you don't need

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  • Prices for used vehicles increased 10.5% in June, and some models are worth more used than new.

  • "If you have a car to sell, there's never been a better time," the CEO of a car-shopping service said.

  • Getting multiple offers could be worth thousands of dollars on the sale or trade of your old vehicle.

  • See more stories on Insider's business page.

The used-vehicle market is unusually hot this summer, and it's spelling profits for some car owners.

Prices for used car and trucks increased 10.5% in June, the highest of any consumer spending category, and some models are going for higher prices now than they sold for new a year ago.

A lack of supply and a lot of demand is causing prices to soar to new records. Average used-vehicle prices topped $22,500 at the start of May, and are just beginning to start ticking back down.

"If you have a car to sell, there's never been a better time," said Pat Ryan, the CEO of CoPilot, a personalized car-shopping service. "Dealers will pay incredible prices."

Read more: When I first became a millionaire I bought fancy cars and watches. Now I'm much more thoughtful in my purchases - here's how I spend my money.

When Silverado owner Franko Dokaj went to buy new floormats from his dealer, he was offered $3,000 more for his year-old pickup than he originally paid for it, the Wall Street Journal reported.

One dealer told the Journal he used to run TV ads showing the sale price of new cars. Now his ads tell potential customers how much their trade-ins are worth.

Of course, there are a few caveats to consider before rushing off to find a buyer, namely whether you need to replace the car, or if you're trading it in for a new one.

Toby Russell, a co-CEO of the used-vehicle marketplace Shift, previously told Forbes that his company was paying 25% more for vehicles than it did at the start of the year.

"Normally we would lose a little money on that, but we're making money on these because auction pricing is so intense and high," he said. "It's just a total dislocation in the market."

Ordinarily a year-old trade-in would lose as much as a quarter of its value, but some in-demand trucks and SUVs are being traded back to dealers for more than last-year's purchase price, a CNN analysis of Edmunds.com data found.

A year-old Dodge Ram 2500 is now worth about $5,200 more than it cost new last year, while a Ford F-250 is worth $3,300 more, CNN found. Other popular models, like Jeep Wranglers and Honda Civics, lost some value, but only a fraction of what normally gets carved off when you drive off the lot.

Most used inventory comes from off-lease models or former rentals, but the pandemic disrupted that flow and in some cases caused it to reverse. When the chip crisis cut the supply of new cars, automakers curbed their fleet sales, forcing rental companies to buy used cars instead.

Ryan said he doesn't see an end in sight for the lack of supply, which is down roughly 90 percent from normal for price-points below $20,000 - an issue he speculates could be related to buyers using government stimulus money.

"It's not clear where the supply comes from, because there's no used car factory you can ramp up and start producing," he said. "The market could be like this for quite a while."

So, if you have a car to sell or trade-in, Ryan recommends contacting several dealers to get a few bids. It's not quick or easy, but it could be highly rewarding.

"We regularly see people who went to go offer their car online, and then they called another dealer and found there were $4,000 or $5,000 differences that were people were offering," he said.

If you're considering a trade-in, Ryan suggested that you would get the most bang for your buck swapping an in-demand crossover SUV or pickup truck for a higher-end sedan or compact from a maker that has been less affected by the chip shortage.

"Dealers are thirsting for inventory, there's no question about it," he said.

Read the original article on Business Insider