Topic: Car repossessions are on the rise in warning sign for the economy (Read 352 times)

The same negative trend also applies to housing loan markets.

While many contractual loans are failing at historically high rates. Could there be an eventual upside in terms of car and real estate assets becoming more affordable within the foreseeable future?

It has recently been acknowledged that used car prices are downtrending sharply at a record rate, (I think) in correlation with the elevated rate of failing car loans.

Cox Automotive said Wednesday that its Manheim Used Vehicle Value Index, which tracks prices of used vehicles sold at its U.S. wholesale auctions, has declined 15.6% from record levels in January through November. The index dropped to 199.4 last month, below 200 for the first time since August 2021, and is down 14.2% from the same month a year ago. It marks the sixth-consecutive month of declines.

Perhaps we will likewise see real estate market values fall within a similar trend, which would make living space more affordable for many current full time employees who cannot afford it.

Unfortunately, there could be another trend in play here. Cars and living space might increasingly become deflationary in supply. It has been reported that US automakers are inching nearer to bankruptcy. Which could result in overall scarcity of car supply, if production and competition decline.

Similar trends could also apply to US real estate markets. Where influxes of immigration could contribute towards real estate and living space becoming increasingly scarce and limited in supply.

But in the short term, from the chart above we can see that used car prices are declining and perhaps that will correlate with long term market trends to make transportation and living space more affordable.

The most crucial factor to consider here is 'Inflation,' It's driving the economy insane, I only hope that its effect would not deprive people of their wants and comforts as it has already done.

When the price of everything is persistently rising, how could commoners be able to change their cars, house and valuables? This is practical in the sense that the purchasing power of their legal tender is shrinking, and this is happening in an environment where wages and salaries are not reviewed upwards. This is the time to be prudent and also look for extra ways of income to reduce the impact on ourselves and our loved ones.

I believe that is also what one of the agents in the dealership I went with told me regarding the reason why they don't have the 2022 variant of the car that I'm eyeing on. He said there were a shortage in electronic chips, but not in manpower nor any other parts that the car needs in order to function. The delay was something like 9 or so months if I can remember correctly, and the vehicles they have in the showroom can't be purchased by cash, only through financing and bank loans which is, in itself absurd because if you do that option, the car's value will go up 200% compared to when you buy it directly with cash.

They also have a used car section and those prices are also unjustifiable given the age and miles put on those cars. There is a 2004 Camry that is still worth an absurd $7,000 clocking 89,000 miles that is on display on that dealership. The agent said that it was in mint condition and was always on time for the car's inspection and maintenance. That Camry is nice and all, but I don't think it's worth $7,000 tbh. Vehicle prices has been surging recently, and repossessions of these vehicles coming to a higher level may mean that people just haven't got enough money to cover for their mortgage/rent, food, and their cars, and has to let go of the latter because they can get by with public transportation.

Cars can be used for your businesses, and that is not a liability for me.
There’s a lot of defaulted loans since the pandemic started until now, and its expected that it will continue to increase because many are still suffering financially. Many economies sees their recovery in the next three years so probably we might see good improvements by next year but the trend for a repo cars might not be changed, it will continue to increase as well.

Cars can be used for your businesses, and that is not a liability for me.
There’s a lot of defaulted loans since the pandemic started until now, and its expected that it will continue to increase because many are still suffering financially. Many economies sees their recovery in the next three years so probably we might see good improvements by next year but the trend for a repo cars might not be changed, it will continue to increase as well.

Id like to interject that Cars are 99% liabilities while property and houses are not.  

so my op that the fact that cars are about to get repo'd is more of a balancing of the eco more then a large scale problem.  

While many contractual loans are failing at historically high rates. Could there be an eventual upside in terms of car and real estate assets becoming more affordable within the foreseeable future?

Unfortunately, there could be another trend in play here. Cars and living space might increasingly become deflationary in supply. It has been reported that US automakers are inching nearer to bankruptcy. Which could result in overall scarcity of car supply, if production and competition decline.

Similar trends could also apply to US real estate markets. Where influxes of immigration could contribute towards real estate and living space becoming increasingly scarce and limited in supply.

But in the short term, from the chart above we can see that used car prices are declining and perhaps that will correlate with long term market trends to make transportation and living space more affordable.

Isn't the crisis of electronic chips and charging the main reason for the price hike during the past year? I remember that most of the agencies were unable to provide model year cars even with the high prices and advance payment, which caused them great embarrassment, including the increase in the prices of the rest of the models for the past years.
In general, in the local market here, and without lending prices, car prices suffered from sharp fluctuations, and the problem of loans has added additional challenges.

Perhaps we will likewise see real estate market values fall within a similar trend, which would make living space more affordable for many current full time employees who cannot afford it.

Car and housing markets are two very important indicators to understand the mode of the economy. Because these are two things that families own when they have some surplus money and a stable income source. So whenever there is a decline in car and housing demand and a rise in non performing assets, it's usually a very concerning matter for the economy. It shows that the income sources are drying out and new sources are not getting created. That also initiates a decline in demand of general consumer goods which eventually leads to more job cuts and income losses.

Probably the first world countries are moving towards a recession and the third world countries are going to be benefited out of it.