Used car prices have soared in the last couple of years as new cars became hard to find, and people turned to used car lots to fill the gap. That led to a banner year for companies like CarMax and Carvana, which saw big sales numbers from inflated used car values. Unfortunately for those businesses, buyers appear to be tired of the high prices, and rising interest rates have made it more expensive to get loans. While those things won’t cause a seismic shift in used car prices immediately, they’re good signs for people waiting to buy.

CarMax recently released its third-quarter earnings, which missed projections and raised concerns about a slowdown in used car buying. The company cut back on used vehicle purchases and said that it would focus more on lower-cost older vehicles to keep customers happy. The company will also slow hiring and rely on employee attrition to cut costs over time.

Company CEP Bill Nash said that affordability has to be a part of the picture in the future, saying that high prices are “keeping a lot of people on the sidelines right now.” He noted that prices are falling, which helps create differentiation between new and used vehicles. 

What lower used car prices and this change mean for you

While this news is a fantastic development for used car buyers and hopeful buyers, it also means lower trade-in and purchase values when you try to sell your current vehicle. Dealers know they will sell the car at a lower price, so they are less willing to pay top dollar. If you bought your car in the last couple of years, there’s a good chance you paid a premium, so be sure to check the difference between what you paid and what you’re getting.

As prices fall, some dealers will be ahead of others on the curve. Some bought cars at inflated values and won’t be instantly willing to unload them at a loss. That makes it extremely important to shop around to make sure you’re seeing the whole picture. Dealer A may have a car on sale at what seems like a reasonable price until you check Dealer B and notice that it’s a few thousand less. Take your time, and don’t settle for the first car you see. The current environment makes it tough to find deals, but you can find a reasonable price and not overpay.