Radio today: Truck demand goes south - Any rumors?

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firsttimetahoe

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Idk man. Every dealer is buying leases out around here so I’m not too worried about it

I mean, what I’m saying is true lol

OFF-LEASE BUYOUT RESTRICTIONS
Captive finance companies that place partial or complete restrictions on 3rd-party off-lease buybacks:
Acura Financial Services
BMW Financial Services
Ford Credit
GM Financial
American Honda Finance
Hyundai Motor Finance
Infiniti Financial Services
Kia Motors Finance
Lincoln Automotive Financial Services
Nissan Motor Acceptance
Southeast Toyota Finance
Volvo Car Financial Services U.S.
Captive finance companies that have no significant restrictions on 3rd-party off-lease buybacks
Chrysler Capital
Mazda Financial Services
Mercedes-Benz Financial Services
Mitsubishi Motors Credit of America
Toyota Financial Services
Volkswagen Credit
Source: Automotive News research, CarMax
 

R32driver

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People are still paying over MSRP for these cars that cost as much at 70-80k.

Escalades apparently have a $25k markup and dealers can’t keep them on the lots.
Both of these statements are true. When we were buying our yukon last august I was hanging out with our salesguy for a bit waiting to sign paperwork and he was telling me they were marking up every vehicle that came in, especially the escalades. $30k markup and selling for $140K with people practically lined up at the door to get one...
 

fr8bil

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I heard that today on a radio news station and was wondering if this aligns with the fact that some car orders here expedited lately.
I wonder what the truth is... how much the demand softened and if that will lead to significantly better delivery times AND/OR better falling used car resale value.

Does anyone have more information on that? Did anyone hear something from a dealership? Just interested in more background.
After reading this from FORBES, it's easy to see why Truck and large SUV prices would be crashing. https://fortune.com/2022/03/15/gas-...t-six-months-economic-ripples-even-more-dire/ The sad thing is they are trying to blame the ridiculous price increases solely on the Russians and Ukraine when we know Biden's Energy policies is a larger part of it. Prices were going nutso long before Putin invaded Ukraine.
 

tom3

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I'd guess there is a limited pool of buyers that will, or are able to, pay the absurd prices for these vehicles and that pool of buyers is running dry.
 

drmoose

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its not just cars. The "Zillow" price of my house has gone up ~50% in the last 12-18 months. And given the base, that's ALOT. We are in a weird economy. Bottom half is in a bit (or a lot) of trouble), but top half is rollin in the dough. IN the PNW, tech is making 20-somethings bucket-loads of $$. I have a (high-up) friend who works at Amazon tells me that a typical programmer 2 years out of college can make ~500k/yr, easy.
 

Doubeleive

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GM just added a 3rd production line to the Silverado's things will step up eventually and then many will be left holding the bag, used vehicle prices will drop, if anything we are at the peak right now
 

GoHeels

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its not just cars. The "Zillow" price of my house has gone up ~50% in the last 12-18 months. And given the base, that's ALOT. We are in a weird economy. Bottom half is in a bit (or a lot) of trouble), but top half is rollin in the dough. IN the PNW, tech is making 20-somethings bucket-loads of $$. I have a (high-up) friend who works at Amazon tells me that a typical programmer 2 years out of college can make ~500k/yr, easy.

I'm in tech. That number feels pretty high even factoring in cost of living & stock options. If it's accurate, I'm moving out to the PNW. No doubt tech salaries have increased significantly over the past 24 months and its very competitive from the employers side.

House prices are definitely nuts, but Zillow is notoriously out of touch with reality. The Zestimate on our house is 20% higher than reality.

I didn't think a housing crash was coming anytime soon until we talked to a lender about a different house. The amount of money they approved was shocking. I would be comfortable with about 60% of what they approved for and even then felt like we would tighten up the budget. IMO, we won't see this effects from this for a few more years though. It will take housing prices leveling off and buyers remorse setting in before the ball starts rolling downhill.

I also don't think vehicle prices are coming back down regardless of chip shortages. Call it the pessimist in me, but people continue to buy at current prices so what incentive do dealers and manufacturers have to lower their prices? None.
 

firsttimetahoe

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I didn't think a housing crash was coming anytime soon until we talked to a lender about a different house. The amount of money they approved was shocking. I would be comfortable with about 60% of what they approved for and even then felt like we would tighten up the budget. IMO, we won't see this effects from this for a few more years though. It will take housing prices leveling off and buyers remorse setting in before the ball starts rolling downhill.

You still have to put a down payment of 20% when you buy a home, unless you qualify for a program that lets you put down less...but that then also means you can't have a large mortgage so it's not like you can buy a million dollar home with little to no down.

When you're buying a home, the bank needs to see your current income, wages over the last few years and obviously you need money for a down payment, Can people over-exert themselves in the housing market still? Absolutely. You have to also factor in taxes, heating, cooling, electricity. utilities and upkeep. Most people know what their mortgage payment will be & what their taxes should be so they have enough set aside every month for to budget for those and still have ecxess income from their paycheck.....but then get blindsided by the other expenses that go into a home. Or they don't have enough saved god forbid things start breaking that cost 10k+ to fix

But when it comes to buying and financing a car all they care about is your credit score. I may have great credit but absolutely cannot afford $1000 a month for car payments.

But I hate the comparison. I can be in over my head 2-3 years down the road when I buy my house and sell it for a profit. 2-3 years from now there is no way your car will be worth even what you paid for it, let alone more. Unless it is some sort of exotic car, a car is a depreciating asset 100% of the time
 

GoHeels

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You do not have to put down 20% but you would incur PMI if under 20%. I'm fairly certain this is across most loan types including jumbo. PMI is a scam IMO, so I do agree that a 20% down payment is ideal.

Our dealership verified our income as well. Although not as thorough as home buying, it was not just credit score.

Nothing in guaranteed, including selling your home for a profit in 2-3 years. Realtor fees alone force a considerable appreciation before you will realize any profit.
 

firsttimetahoe

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You do not have to put down 20% but you would incur PMI if under 20%. I'm fairly certain this is across most loan types including jumbo. PMI is a scam IMO, so I do agree that a 20% down payment is ideal.

Honestly I didn’t even realize people would put down less than 20% on a jumbo to opt to pay PMI with interest rates as low as they are. You’re essentially paying interest on top of your interest lol.
 

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