Recently, many people have asked me whether buying a car at the end of the year is really cost-effective. I’ve reviewed the latest used car pricing report and want to share some practical car-buying insights.

First, the conclusion: buying a car at the end of the year isn’t necessarily cheaper than at other times, but there are definitely opportunities to find good deals. The key is doing your homework.

Last year, the average price of used cars rose to $33,718, up 4.6% from the previous year. At first glance, it seems like prices have increased, but the reality is more complex. Some models’ prices are actually declining; the overall increase is driven by buyers shifting toward larger vehicles, higher-end trims, and the rising proportion of electric vehicles, which raises the average. So, when shopping at year’s end, don’t just look at the discount tags—compare prices of cars of the same year, brand, model, and mileage to truly see if you’re getting a good deal.

I spoke with an industry insider who emphasized one key point: doing your homework can save you a lot of trouble. First, set a realistic budget and determine what cars are available within that range. It’s also important to understand what mileage is typical for a given vehicle age. Some dealerships clearly display pricing backgrounds, vehicle history, and inspection details, so buyers can focus on whether the car meets their needs rather than discovering issues later.

Regarding strategies for buying at year’s end, I’ve summarized a few practical tips:

1. Stay flexible. Be willing to consider different models, such as choosing a sedan instead of an SUV, or accepting variations in color and features. These adjustments can lower costs without compromising reliability.

2. Broaden your search area. Don’t limit yourself to your local dealerships—inventory and prices in nearby cities can vary significantly, and you might find a better deal.

3. Research common issues. Before buying, learn about potential complaints or maintenance problems associated with the model. Sometimes these are minor, but if a certain mileage point often requires major repairs, it’s better to consider other options.

4. Prioritize used cars still under manufacturer warranty. Manufacturer warranties are usually more valuable than third-party ones and can save you money in the future.

5. Read the contract carefully. Don’t pay for add-ons you don’t want. Take your time to review the agreement before signing, and speak up if there are items you wish to exclude.

Another often-overlooked aspect: hidden costs. Insurance premiums, fuel consumption, maintenance needs, and potential repairs can vary greatly. It’s advisable to secure financing beforehand—consider getting pre-approved from your bank or credit union—so you can focus on overall value rather than being swayed by monthly payments.

Credit score is also crucial. If your score needs improvement, spend the few months before buying paying down debt and making timely payments. This can help you secure the best financing rates.

Someone asked me whether to wait until next year to buy. My answer is: waiting doesn’t necessarily lead to better results. Car prices are more influenced by supply changes than by the calendar date. Dealerships are currently trying to clear inventory to make room for new models, so you’re likely to find good deals. The best time to buy at year’s end is when you see prices on your desired model improve. If it fits your needs and budget, acting decisively is often wiser than waiting for the perfect moment.