Are you are planning to sell a car?
If so, then you might have checked Kelley Blue Book (KBB) to determine a fair selling price.
Kelley Blue Book is a popular evaluation guide for consumers and dealerships. Although, there are many misconceptions about the guide that create confusion among consumers. They wonder, “why are so many cars overpriced?” or, “why do dealers laugh at the Kelley Blue Book price?” In this article, we dive in and learn how the Kelley Blue Book price is set, how to use KBB prices to get a good deal on your car, and much more…
What is the Kelley Blue Book Price Based On?
First, we need to address the largest misconception about KBB:
They are not setting prices for the market.
Instead, KBB tracks selling prices from wholesale auctions, independent dealers, franchised dealers, rental fleets, financial institution leases, private party transactions, and more. Simply put, they follow a trail of transactions across the country and calculate vehicle values based on pricing data and economic conditions.
There are other factors to consider that also affect your car’s price that the Kelley Blue Book price doesn’t account for:
- Are you selling or buying from a dealer? Dealerships have high overhead and lending costs; this places consumers in a position to lose money. Dealerships have to make a profit, so you cannot expect to get a fair Kelley Blue Book price. Even if you do get a fair price on a trade in, you will lose that money on the other side of the deal. If you make an extra $1000 on your trade in, they will charge an extra $1000 on the car you buy.
- Private parties want to get the best price. Why are vehicles on Craigslist, Autotrader, and other online car sites set at higher prices than KBB’s quote? Again, the Kelley Blue Book price is not meant to reflect a fair price for a vehicle. They merely track prices. With that understanding, you can begin to look at your car’s price in the context of your market. Private sellers set prices high because they expect people to negotiate them down. The same goes for “low ball” offers: most buyers expect to negotiate up. Don’t let either of these discourage you. Selling a vehicle is about negotiation.
- What kind of deal are buyers looking for? This is where most car buyers mess up. Instead of looking for a great vehicle at a fair price, they are trying to find GREAT deals that are under priced. Here’s why this doesn’t work: amazing deals usually come with an invisible cost. In the end, a buyer isn’t going to care about a great price when the car breaks down. As a seller, you should do your best to show them the value of a trustworthy transaction (which we will talk about in a moment).
Having said that, is it realistic to get a Kelley Blue Book Price?
How Often Can You Get a Kelley Blue Book Price?
To get a Kelley Blue Book price, you have to understand leverage.
For example, if a buyer is carrying cash, they are going to expect that they can negotiate you down. Having cash gives buyers leverage to close deals (it’s almost like you can smell the money).
Also, do you have a deep understanding of the true condition of a vehicle? More often than not, car owners will over price their vehicle because they believe it is in better condition than it actually is. In truth, very few vehicles are in excellent condition. Here at TRED, we solve this problem by doing a 150-point inspection giving buyers 100% confidence in their purchase.
You can also commit to more research. Equipping yourself with the right information makes negotiating the best deal even easier. Check used car platforms like Craigslist and eBay motors to see average used car prices. When a buyer says, “look, your car is only worth this price because…” you will be able to counter with relevant prices and market information if you do your research.
Here is the sober truth:
It is hard to get a Kelley Blue Book price. Even in private party transactions. With other car evaluation companies like Edmunds, NADA, and Black Book (which often lists lower prices than KBB), it will be hard to convince someone to pay that much–especially if you cannot accurately judge car quality and market pricing yourself.
But don’t become discouraged. You can still get a great deal selling your car at or near the Kelley Blue Book price!
8 Tips to Get the Best Price For Your Car
- Buy new tires. This shows the buyer that you are committed to selling a quality vehicle.
- Extensively clean the interior and exterior. If you want to ask for a competitive price, you can’t show up with a dirty vehicle. There is no reason to trust your justifications for the price if the car doesn’t fit the image.
- Learn standard negotiation techniques. People are not going to agree to the Kelley Blue Book price right off the bat. They want to get a good deal, too, but you shouldn’t be afraid to negotiate either. The buyer is obviously interested if they ask about your car.
- Use online car platforms with competitive financing rates. TRED offers to finance with rates as low as 1.99%. Also, this will help people afford your vehicle because they can take out a loan.
- Establish the car’s condition with proof. Bring the car to a mechanic to get a reliable inspection. Again, this shows that you are a trustworthy seller. Why? Because you are willing to go the extra mile to ensure a safe and reliable transaction.
- Have your car’s documents on hand. Get your title, Carfax vehicle history, and bill of sale together. You never know when you are going to close a deal. If you have your documents, you give your buyer less time to reconsider, and they may be more likely to buy your car immediately out of fear that you will sell it to someone else.
- Learn about pricing psychology Instead of listing at $13,000, list at $12,949. Human brains are weird! For some reason, even though that price is almost the same as $13,000… it seems like it is only in the $12,000 price range.
- Take extensive pictures of the interior, exterior, and engine. People are less likely to inquire about your car if there isn’t enough information. Also, pictures will give buyers confidence. Instead of wondering what they are going to find when they finally meet you, they can be confident that the meeting is worth their time.
One More Tip to Get the Kelley Blue Book Price
On TRED, we use KBB to determine a fair price for each vehicle. With over 90 years of experience, KBB is the most trusted source of vehicle pricing information. Also, TRED establishes trust with buyers by committing to a 150-point inspection to ensure the vehicle’s condition.
That’s why, on TRED, you can expect to get 30% more than a dealer trade in and 12% more than on Craigslist. We do the paperwork, we help you competitively price your vehicle, and we ensure safe transactions with financial and identity fraud protocols.
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