How do you figure out a fair price for your car? Good question! We recommend the following three steps:
1. Determine the retail Kelley Blue Book price.
Answer all the questions honestly, and you'll finish with three numbers: the trade-in value, the retail value, and the private-party value. The retail value is the price you'd expect to pay, were you buying the car from a used-car dealer.
Next, do a little more research to confirm your findings. This sale price estimate also assumes that everything is working properly on your car, and there are no repairs necessary. So, you should deduct the cost of any necessary repairs to arrive at a reasonable sale price.
Finally, you need to honestly assess how you've been taking care of this car. Have you taken meticulous care of it? Then, your suggested sale price might be closer to the private-party value. But, if you've beaten it to smithereens on road trips on the Alcan Highway, and never once had the oil changed, well, you might want to start thinking about expectations.
A lot of sellers find that the price listed by Kelley is higher than they had anticipated. There's a good reason for this - but to find it, you need to read the fine print. It turns out, most car owners accidentally misrepresent the condition of their car, telling Kelley it's in better shape than it really is. For example, Kelley Blue Book says that only a measly 5% of used cars are actually in "excellent" condition. The moral of the story? Be very conservative when you rate the condition of your car, and you're likely to get a more realistic value.
2. Double-check the suggested sale price, by going through the same exercise at the other major competitor of Kelley Blue Book, Edmunds.
3. The final step to figure out a fair selling price for your car is to check out the real-world asking prices for private-party sales of cars similar to yours.
Look for the same year, make and model car that's for sale from a private party, not a dealer. It should have a roughly comparable amount of mileage and be in about the same condition and with the same accessories.
Once you've got a sense of comparable sale prices, pick the price you think is fair. Set it high enough so you can lower the price a bit, and still know that you'll be happy with the end result.
Read more about this topic in the Car Talk Community!