EDITOR’S NOTE: This article is part of our Money254 Partner Series produced in partnership with Peach Cars.
If you have been saving to buy a car in 2024, you may wonder which is the best time to make that purchase.
Market studies and opinions from experts indicate that January is the best time to buy a used car. This trend can be explained by the laws of supply and demand - or more simply, by the realities of January blues which Kenyans popularly refer to as Njaanuary.
As car owners recover from the holiday expenses, the supply of used cars sold in the market is usually high. For employed Kenyans, for example, most December salaries are processed in the first half of December.
This salary is ideally supposed to last until late January. But even the best-laid plans often go awry. Managing the December salary across two months is a difficult, although not impossible, balancing act for some people.
This results in what is humorously referred to as the 90 days of January - or the month of January having too many days from where the money ends.
In the event of a cash crunch, such as a ripe opportunity or an emergency requiring a significantly high amount of cash, car owners often liquidate their cars at this point.
As a reaction, the increased supply of cars put on sale gives you an increased pool of options, which increases the chances of quickly getting the right car.
Beyond the increased options, the demand for cars is relatively low in January compared to other months.
The slump in demand results has an impact on the price as both individual car sellers and dealerships reduce their margins as they seek to dispose of the fleet in January.
This trend is not unique to Kenya, as a study by American car search engine firm iSeeCars found after analysing used car sales trends between 2018 and 2022.
However, other factors make January an ideal month to buy a car in Kenya. We are going to discuss some of the reasons in greater detail.
In January, Kenyan parents experience heightened financial pressures as they grapple with the responsibility of covering school fees and other school-related costs for their children.
The start of the year marks the beginning of a new academic term, and parents are faced with the daunting task of meeting tuition and related expenses. For many families, the burden is compounded by the aftermath of the festive season, where spending on travel, food, clothing, and other festive-related expenses leaves many with empty wallets.
The school fees challenge is complicated because January is usually the start of the school calendar year and necessitates the purchase of new textbooks - whose prices have recently shot up.
Parents with kids transitioning to high school not only grapple with increased school fees but also other expenses such as new school uniforms and associated costs.
In this cash crunch, it is common to find many parents who own cars selling them to cater for the more urgent fees.
The New Year is a season of self-reflection and optimism, prompting individuals to make resolutions.
It's a time when many Kenyans set goals, embrace positive changes, and take steps for personal development. The symbolic fresh start of the year often results in more cars in the market.
Some owners sell their cars to relocate abroad, others to change the brand or type of car they had in the other year, while others sell the car to pursue other dreams such as raising capital for a new business.
In summary, the New Year resolutions often make it an easier time to buy a car - particularly a used vehicle from car owners making these kinds of life adjustments.
December is usually a busy period for most Kenyans. Our holidaying culture often involves traveling upcountry - and it’s more comfortable and convenient when you have your car.
Thus, some car owners who initially planned to sell their cars towards the end of 2023 may have opted to defer the sale to January when they will be done with the festive and school opening travels.
Despite the factors that make January a good month to buy a locally used car, the process can be challenging.
One of the biggest headaches for buyers of locally used cars is verifying the genuineness of buyers and the cars they sell or purport to sell.
Stories of scammers targeting car buyers abound as unscrupulous people seek to take advantage of the market. Sometimes buyers are tricked into parting with their money before the car mysteriously disappears.
Others get the car, only to find out that the car they took home was not in the state advertised. There is mileage interference, to begin with. Mechanical issues are hidden using all manner of lights including placing pieces of paper behind the dashboard where error lights display.
In other extreme cases, car buyers are tricked into meeting robbers and kidnappers in the guise of seeing the car of their dreams.
If you have been wondering how to get around this challenge, you may consider using Peach Cars, Kenya’s premier used-car marketplace that has been in operation since 2020.
Peach Cars seeks to democratise the used cars market by offering:
Peach Cars verifies all the cars sold through its platform including the identity of the sellers. Viewing can also be arranged at Peach Cars’ offices which eliminates the risk of encountering unscrupulous sellers.
Peach Cars conducts a 255-point vehicle inspection and the diagnosis report is shared with the buyer. This serves as a further verification to confirm is in the mechanical state advertised.
It also helps to inform the buyer of potential servicing that may be required in the future, allowing the buyer to make the relevant planning and make the purchase decision with confidence.
Peach Cars uses an escrow payment process where money is only released to the seller and the buyer is satisfied with the car and the sale agreement.
Peach Cars offers support in drafting the sale agreement and extends support even after the payment is concluded. Their team of experts assist both the seller and the buyer with the vehicle transfer process including navigating NTSA’s TIMS platform to ensure the buyer is issued with the new logbook in a fast and smooth process.
Another benefit of using Peach Cars in your used-car search is the fact that the Peach Cars team has both local and international experience in the auto industry and has networks and knowledge that can help you pick the right car.
This includes insights on market trends to understand the actual value of the intended vehicle, the market cycles, assistance getting specific models that may not be available in their fleet, etc.
January is an ideal month for purchasing a locally used car for several reasons highlighted above. They include the increased supply of locally-used cars as car owners seek to raise cash or upgrade in the new year.
As the supply increases, sellers may be more willing to negotiate prices and offer favorable deals, considering the post-holiday financial strain.
Despite the increased supply and relatively lower prices, buyers still face the challenge of verifying the vehicles they sell and the genuineness of the sellers. One of the ways to overcome this challenge would be to consider Peach Cars, Kenya’s first marketplace that is dedicated to the sale of used cars.
It not only verifies that the car sellers are genuine, but it also allows a physical inspection of the car in their offices - including a 265-point vehicle inspection to ensure that the car is sold in the mechanical state it is advertised.
Would you consider Peach Cars in your car ownership journey, have a local at some of the vehicles listed on their marketplace here.