An old adage in real estate is that your first offer on a home is usually your best offer. This isn’t true in every situation, of course, but there are many reasons why realtors believe this. And from our research, adopting a similar philosophy can benefit dealers when consigning their vehicles at auction.
In its latest research study, Cox Automotive discusses how measuring price retention using a vehicle’s value the first time it is offered versus the date it sells ignores the depreciation costs associated with no-selling and offering it for sale multiple times. Findings reveal that the average depreciation on a vehicle by the second offer is 0.7% and jumps to 1.5% by the fifth offer, or nearly $180 on a $12,000 vehicle. Given this trend, consignors should not only price their cars to sell quickly, but also consider accepting a buyer’s first offer rather than holding out for a better one.
Review the report’s findings for more information.