Selling used Tesla vehicles. Why people dont have realistic expectations?

[vegas888]

This is not only M3 specific but would like to understand people expectation.

I was considering buying used Tesla locally from private party for 2 reasons.

First, no sales tax. Could save about 3-4k.
Second, i could see the car in person before buying it.

But every time i called other party (autotrader,FB Marketplace,craigslist) i got very high price, often more then what Tesla is selling with warranty on their website or they are asking even more what i would pay for new one.

People selling their Tesla`s usually wants to buy new one.
But instead to get $37k from me for 2019 M3 they want $40k.
Their excuse is " you are saving $3k because non paying sales tax".
Also they are not willing to negotiate

And what is worse is they end up selling it to Carmax or trading with Tesla for MUCH MUCH less then what i would give to them.

Recently my coworker bought new MS and gave his old MS to Tesla for $29k.
I offered him $35k and he refused. He wanted $40k.
He tried lower it to 33k days before giving it to Tesla but then i refused.

I see many of these sales/transactions end up with trade in with Tesla, only because people/sellers are refusing to lower their price for private sale. And losing many many thousands of $$$.

Tesla site has very high price for their used cars .
But they offer very low for "trade ins"

I think people should be realistic.

I feel like they are more concerned about me paying less then what they paid 2 years ago then anything else.
And this is case only with Tesla`s.
Never had this issues with other cars

 

[Phlier]

Print out the "book value" from Kelley and a few other car valuation companies for each Tesla that you're looking at.

Expect to pay right at the top end, as Teslas really hold their resale value.

You'll find people that'll sell for book value if you look around a bit.

 

[Pied]

I see this too, just buy new.

It's similar issues with the Subaru WRX. People want ridiculous amount for a 5 year old used car.

 

[vegas888]

One guy wanted $40k for his 2 yr old M3 with 20k miles.

When i told him i can buy new one for that price he told me "yes but you are saving on sales tax".

But why he does care about my tax?
Its like he is more concerned about my finance then what he is getting.

I know he ended up trading his M3 with Tesla, losing many $$$.
He is my neighbor (next street from me) and now he is even avoiding me

 

[Pied]

There are a lot of other factors than just taxes when you buy used. If you're financing, the interest rate on a used car is higher than a new. That difference over the life of the loan (assuming 60 month) can easily add ~$1k in interest expense.

You are also 2nd owner and a little less warranty. Imo the new updates to the Model 3 are worth getting new instead of used right now.

 

[UncertainTimes]

Somewhere along the line, Elon convinced us our cars appreciate with each software update.

 

[Chisale]

Just a tip that in almost any state that charges sales tax, you are still required to pay tax on private auto sales transactions. Skipping it is sales tax evasion.

 

[glide]

This is not only M3 specific but would like to understand people expectation.

I was considering buying used Tesla locally from private party for 2 reasons.

First, no sales tax. Could save about 3-4k.
Second, i could see the car in person before buying it.

But every time i called other party (autotrader,FB Marketplace,craigslist) i got very high price, often more then what Tesla is selling with warranty on their website or they are asking even more what i would pay for new one.

People selling their Tesla`s usually wants to buy new one.
But instead to get $37k from me for 2019 M3 they want $40k.
Their excuse is " you are saving $3k because non paying sales tax".
Also they are not willing to negotiate

And what is worse is they end up selling it to Carmax or trading with Tesla for MUCH MUCH less then what i would give to them.

Recently my coworker bought new MS and gave his old MS to Tesla for $29k.
I offered him $35k and he refused. He wanted $40k.
He tried lower it to 33k days before giving it to Tesla but then i refused.

I see many of these sales/transactions end up with trade in with Tesla, only because people/sellers are refusing to lower their price for private sale. And losing many many thousands of $$$.

Tesla site has very high price for their used cars .
But they offer very low for "trade ins"

I think people should be realistic.

I feel like they are more concerned about me paying less then what they paid 2 years ago then anything else.
And this is case only with Tesla`s.
Never had this issues with other cars

Why don’t you just buy new then?

No one is forcing you to buy new or used or a Tesla.

 

[fr100]

I also notice a lot of people trying to sell their used MacBooks for way more than they are worth.

 

[OCR1]

There is not much reason to buy a used Model 3 right now. The 2021 model has some significant new features. It will take some time for the used market to adjust to the fact that they no longer have the latest and greatest features. Keep in mind that Model 3’s only started selling in volume in 2018, so there are not that many people looking to sell their Model 3’s just yet. Give it another year or two and there should be enough supply to drive prices down.

I found this article very interesting:

U.S. used car and truck prices rise the most since 1969

 

[geekflyer]

I noticed the same thing. There's lots of postings on craigslist where people offer their used Tesla for the same price as new, in some cases even higher. I've also seen people pricing in their all their mods, like wheels, spoiler etc. at new price.
There's a bunch of contributing factors to this, but a non-obvious one is:
Model 3 used to be a lot more expensive when it came out (when you don't factor in tax incentives), so lots of people take that original price they had on their bill, apply some deprecation on it and completely ignore the tax incentives they received and that tesla substantially lowered the price.
I think this is factor that even shows in KBB (KBB prices for Tesla model 3 are often also quite inflated imo) and pricing of used car dealers. It's highly unusual for car prices to go down year over year (most ICE cars go up 1-5% for each new model year) AND for car MSRPs to change mid-year. On top of that Tesla officially didn't really have a '18/'19'/'20 model - it's "officially" still the same car.
All this makes the usual price prediction models KBB and used-car dealers pretty inaccurate and inflates the asking prices.
With high-demand there are actually also some uninformed buyers who buy cars close to MSRP.

I think now that the Model 3 MSRP stabilizes a bit more (and tax-incentives are gone) and tesla seemingly moves to more traditional refresh cycles (2021 is pretty much a annual refresh instead of just a small feature improvement as seen before and even Tesla reps use words like "old model", "new model" to distinguish them clearly) we will probably see more realistic used M3 prices next year.

 

[ftmaybe]

I think people should be realistic.

Yes, they should. There is no logical reason for used tesla pricing but I can only guess that it is what it is because some people actually pay the illogical prices. I look at used teslas about once a week and am still dumbfounded at the pricing.

Demand has to be part of the pricing (can't get a new 3 or Y anywhere really without waiting, and the impatient may be paying a lot more than they should for used), but I also think Elon steadily dropping prices on new models is contributing.

But the market is waht it is, so like someone else said, you just have to buy new. That's where I am at.. I would absolutely buy a used Tesla over a new one but not at all with the current market.

 

[FlatSix911]

There is not much reason to buy a used Model 3 right now. The 2021 model has some significant new features. It will take some time for the used market to adjust to the fact that they no longer have the latest and greatest features. Keep in mind that Model 3’s only started selling in volume in 2018, so there are not that many people looking to sell their Model 3’s just yet. Give it another year or two and there should be enough supply to drive prices down.

I found this article very interesting:

U.S. used car and truck prices rise the most since 1969

Thanks for sharing.

 

[afty]

Just a tip that in almost any state that charges sales tax, you are still required to pay tax on private auto sales transactions. Skipping it is sales tax evasion.

OP is in Nevada where sales tax is not collected on private party car sales. See Private Party Vehicle Sales

 

[OCR1]

OP is in Nevada where sales tax is not collected on private party car sales. See Private Party Vehicle Sales

That is a unique benefit of buying a used car in Nevada. The buyer would also avoid the $1,200 delivery fee. It still may not be enough to justify the high pricing but it does help adjust the difference between new and used a bit more than it first appears.

 

[jeremymc7]

When one of my Tesla’s got totaled the insurance company paid me more then a new one. They were shocked themselves but their system is based on comparable’s and all the used similar models in my area were more than retail. I made money on that car!

There’s no point try to argue or understand the pricing. Used Tesla’s, especially Model 3, sell for higher prices. They’re priced how they’re priced. No one is going to take a huge discount just because non Tesla’s have a different / more traditional pricing structure.

In most cases only expect to save a minimal amount of a used one and be happy with it or just get a new one.

There are no real deals baring someone needing to dump for quick cash, no idea what they own, there are problems with it.

 

[jkeyser14]

I would rather trade in then do a private sale too. If I trade in, my purchase price is reduced by the trade in value, and therefore my sales tax is lower (6.5% tax in MD on the net sales price). Plus no headache of having to deal with private buyers, fake checks, etc.

 

[jeremymc7]

I get no reduction to tax on trade in here, sadly. But when the next one needs to go it will be traded in to Tesla or given to Carmax or similar. Even if someone gives me more than Tesla I likely will just do Tesla again. These historically (for me) have given above value of other places, never even looked at the car, and it was just soooooo easy.

 

[DrtyJrze]

This whole thread is weird. You’re complaining about what they choose to sell for? They could sell it to CarMax for $10k for whatever reason they want, it’s really none of your business.

In your story you offered $35k first, then your co worker offered it to you for $33k, $2k LESS than you were willing to pay, and you declined. Nobody is going to sell it to you for wholesale cost when they get other incentives from a dealer.

The fact that you even posted this tells me how you come off irl. If someone rather lose money then sell to you, you might want to take a look in the mirror and do some internal self reflection.

Saying you have horrible negotiation skills is me saying it nicely.

 

[CapeOne]

I think people should be realistic.

Some people do have unrealistic value expectations for their cars. I think too many look to "book values" like KBB and NADA to set price but those can be high when pricing Teslas. If a seller's price is truly unrealistic, they won’t get much traffic and will have to lower it eventually if they are genuinely looking to sell.

At the same time, a buyer's price expectation can be unrealistic. What are you basing your pricing/offers on? For example, what would you consider to be a fair price on a 2019 M3 SR+ with average miles, premium paint color, 19" sport wheels, and FSD that originally sold for $50k (plus tax) new?