What's it really worth? Canadian Used Car Values
By Grant Yoxon

One of the most frequent questions we receive is, "Where can I find Canadian used car prices on the Net?"

Until recently, the answer was, "You can't."

That was before Cars On CD - an annual guide to new cars - began producing a Canadian used car value search engine on its Web site. It provides information for vehicles built since 1992. Select a make, model, year and one of three levels of condition - A1 (good), A2 (average) and A3 (poor) - and the search engine will return a value.

There is no information on the Cars On CD site about the meaning of the three levels of condition or how to interpret the dollar value returned. However, insurance company Belair Direct, which recently began providing the Cars on CD used car values on its own site, does offer some words of caution: "The prices provided for used vehicles are indications only. They do not always take into account options (engine output, transmission type, etc.) that may affect the vehicle's worth. Also note that values obtained correspond to the resale value between individuals. With a dealer, the price given for a trade-in is generally lower."

And the price you will pay is likely higher, if you buy it from a dealer. Although prices are updated monthly, they also don't take into account regional variations. These can have a significant impact on the value of a used vehicle.

But few valuation guides - and there are several in print in Canada - adequately account for all factors that affect the price of used vehicles.Car dealers, insurance companies and provincial licensing agents use the Canadian Red Book, published by Maclean Hunter. It lists wholesale and retail values, based on average amounts paid for vehicles of the same year, make and model. A section at the front explains how to adjust values for regional variations, optional equipment and the amount of kilometers driven.

Some dealers also use the Black Book, published twice monthly by Wm. Ward Publishing Ltd. and based on prices paid at dealer-only used car auctions.

Neither guide is sold at stores or newsstands, but some libraries keep copies of the Canadian Red Book in the reference section (my local library doesn't). However, if you ask your loan manager, you may check the value on a car you are thinking of financing. Dealers may also divulge the Black Book value if they want your business bad enough.

One valuation guide available to the public is The Complete Price Guide, published annually by Édutile, and available at many book stores. Trade-in, private sale and retail prices are listed for all makes and models of cars, vans and light trucks. The guide tells you how to factor in mileage and equipment that ads or subtracts value. Being an annual, the Complete Price Guide is, unfortunately, out of date when you buy it. The publishers suggest subtracting 15 per cent past June of each year. To reflect regional variations, they suggest adding eight per cent in the western provinces and six per cent in the Maritimes.

If you are looking for prices online or shopping for a print guide, be careful. Make sure the guide you buy or the site you find contains Canadian prices. There are many U.S. guides available both in print and online in Canada, including the Kelly Blue Book, Edmunds Used Car Price Guide and VMR Standard Used Car Prices, but none of these is of any use in Canada. There's the huge differences in currency, for one thing. And U.S. values tend to be higher because cars there last longer. As well, a Canadian car could have vastly different standard equipment or options than its U.S. counterpart model, making a direct comparison impossible.

Whether using a print guide or Cars On CD's online price guide, it is essential to remember that used car prices are always moving, generally downward. There is no better guide than knowledge of the local market. If you are contemplating buying or selling in the near future, start now by reading the classified ads in your local paper and buying used vehicle advertising publications. Get a feel for what other people are asking for vehicles similar to the one you want to buy or sell and estimate that a fair market value is something lower.

Online, check out the classified ads at CarClick and MegaWheels which have extensive national databases of used vehicles, and which can be sorted regionally and by municipality. Outside of Ontario, visit CanadaTrader and in Quebec, Hebdo.net.

CanadaTrader and Hebdo.net have Daniel Heraud's 1997 Canadian Used Car Value Guide on line. This guide provides an overview of vehicles built from 1991 to 1996, the pros, cons and specifications, and minimum and maximum prices. However, the prices may be as old as the date on the guide, as they are way higher than other sources, particularly for newer vehicles listed. Advice: use this guide for background information, but not for prices.

Ontario residents should bookmark Trader.ca, not only for its really big database of almost 30,000 Ontario vehicles for sale, but for its handy "Value Finder." Use the Value finder to search for a vehicle and quickly determine the low, median and high price based on ads in the database. To see why they differ, just view the ads. Search by make and model, region or all Ontario.

Determining a fair market value for a vehicle is a blend of art, science and common sense. Value guides are just that, guides. They are not gospel. Use all the sources available to you - classified ads, online guides, print guides, your bank manager and your insurance agent - to research the market.

Never rush into buying a car. Take your time, do your homework and use your common sense.