Quote:
Originally Posted by Matt Monson
I agree with Ficke. Private sellers are also influenced by the cost of money over time. I sold a car last year to a dealer for $1000 less than I could have gotten private party if I sold it myself. I wanted the car off my credit while I bought my new house and I wanted the equity in the car to buy an atv for my new property. Those needs were worth a $1000 to me. Not all private sales are created equally.
Though on the flip side many private sales are emotional. Look at our friend up in Wyoming. He has 100 cars and is attached to all of them.
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Great points, and I totally agree -- I didn't mean to generalize about all private sellers -- just a subset that are focused on not leaving money on the table. Private seller preferences vary more widely than dealers. Some are in love with their cars and over value them, some sell cheap because they need the money, some sell at a discount because of the time value of money -- as you describe.
I've sold a fair number of cars, and usually price them competitively -- primarily because I value my time more than the extra couple of hundred I might make by driving a harder bargain, forcing me to show the car a dozen times, and deal with tirekickers & dreamers. But these were cheaper cars (and a boat & a motorcycle): $3-10k. I've also traded some in where the tax advantage and ease made it worth my while to do so.
When I sold my Boxster, though, I had a much higher reserve price (it was an expensive car -- mid-hi $20s) -- and was willing to hold the car for a long time before selling it.
Eventually, I dropped my asking price $2k because the warranty was due to expire, and the loss in value/depreciation would have made holding the car a losing proposition.
Of course, the markets for newer Boxsters and air-cooled cars are very different. If the Boxster had been appreciating (like 911s) rather than depreciating, and since I didn't need the money for anything else -- I probably would have kept it far longer, and held out for more money.