Best Places to Buy a Used Car

Traditional, Online, or Rental Car Companies: Where to Find the Best Deals

• Rental car companies provide more savings than other retailers to buy a used car, with an average of 1.6 percent savings or $303 according to iSeeCars analysis of over 8.5 million vehicles

• Savings at rental car companies are on average $334 greater than at traditional local dealerships, $747 greater than online dealerships

• Traditional local dealerships provide over $400 in savings compared to online dealerships

• While deals aren’t as significant at traditional local dealerships or online dealerships, savings can still be found

Used car prices have risen in 2020 due to increased demand and limited inventory as a result of the COVID-19 pandemic. With used car prices up and multiple sources to buy a used car from, car buying consumers should examine all their options when trying to save money and find the best deal on a used vehicle. 

“As contact-free online dealers have gained popularity as a safe alternative to traditional dealerships, and as struggling car rental companies unload their inventory, consumers might be considering these alternatives to traditional brick and mortar dealerships,” said iSeeCars Executive Analyst Karl Brauer. “It’s important that used car shoppers compare prices across these types of dealers if they want to get the best deal possible on a used car.”

Car search engine iSeeCars.com analyzed over 8.5 million used car sales across the three dealer types of traditional local dealerships, virtual dealerships, and rental car companies and found that rental car dealers consistently provide the greatest savings, while local dealerships are priced close to market value and virtual dealerships are priced above market value.  

Best Places to Buy Popular Vehicles

Six vehicles on the list are not commonly offered by rental car agencies including the GMC Sierra 1500, the Honda Accord, the Honda CR-V, the Jeep Wrangler, the Subaru Forester, and the Subaru Outback. “These vehicles are still sold at rental car companies, but the frequency and choice will be limited,” said Brauer. 

Six vehicles commonly found across all three retailers stand out as not having the most significant savings at a rental agency. “The Ford Escape has the most savings virtually, and the Ford Fusion and Hyundai Tucson are priced above market value at all three dealership types but have the smallest increase at local dealerships,” said Brauer. “On average, traditional local dealerships are where consumers are most likely to find deals on the Mazda CX-5, while the Toyota Corolla and the Toyota Tacoma have the lowest increases above market value.” 

Best Popular Cars to Buy at Rental Agencies

Two popular sedans, the Honda Civic and the Nissan Altima also offer significant savings when consumers purchase through a rental car dealer. “Despite sedans’ overall decline in market share, these models have remained popular rental options, and consumers can save money on these vehicles through a rental car dealer,” said Brauer.

There are other benefits beyond savings opportunities to buying a used rental car. “Rental cars follow routine maintenance schedules and are routinely inspected for cosmetic damage,” said Brauer.  “All Hertz and Enterprise vehicles undergo a rigorous inspection process from certified mechanics and come with a 12-month/12,000 mile limited powertrain warranty.”

But despite the savings, there are limitations to buying from a rental car company. “Rental cars typically have higher mileage and more wear and tear because they have had many drivers who may not be as careful with the vehicle as they would be with their own car,” said Brauer. “Rental companies also typically buy the base model of a vehicle, so consumers who want higher trim levels may have difficulty finding the specific version they want.”

Best Popular Cars to Buy at Online Dealers

Along with providing a convenient and hassle-free car buying experience by delivering a vehicle right to a shopper’s door, online dealers rigorously inspect their vehicles and offer free protection plans similar to what is offered on certified pre-owned (CPO) vehicles. “If a consumer isn’t satisfied with their vehicle, they have a five-to-seven day return window to help ease anxiety about not being able to test drive the vehicle prior to purchase,” said Brauer.  

Buying from an online dealership also presents its challenges. “Buying a vehicle from an online dealer doesn’t allow you to do a traditional test drive and the dealers use no-haggle pricing, with no negotiation room for car buyers,” said Brauer.

Best Popular Cars to Buy at Local Dealers

Best Place to Buy Used Cars By Metro Area

When purchasing a used car from any type of dealer, consumers should always do their research and follow important steps to make sure a good deal isn’t too good to be true. They should also shop around to see which dealership type can provide the best deals and which will provide more money if they have a trade-in. “Online tools like the iSeeCars VIN check report provides all the important information needed to help consumers find the right car at the best price,” said Brauer. “Regardless of the car buying process they choose, prospective car owners should always obtain a vehicle history report such as CarFax or AutoCheck and have the vehicle inspected by an independent mechanic.”

Methodology

iSeeCars analyzed over 8.5 million used cars sold in 2020 by online-only dealerships, rental car agencies, and other used car dealers. The price of each car on car listings was compared to similar cars sold nation-wide by other used car dealers, as was its mileage. The resulting comparison was expressed as both a dollar difference and percentage difference from “market value”, and the data was aggregated at an overall level, as well as the model level for the best-selling cars of 2020. Models sold at low volumes by any particular dealer type were excluded from the final analysis.

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