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so, I have a question about tinting windows. It's always bothered me that my Outback has these rather dark factory tint in the back windows and the hatchback and the front windows are just clear. Keep in mind, I'm Vancouver (it never gets super hot here), is it necessary to get ceramic tint or is just regular tint is fine? It's more or less just so it doesn't bother me (and no, I'm not getting the front windows as dark as the ones in the back, that's just asking to be pulled over )
America’s Pandemic Car Bubble Is Now Trapping Buyers in Debt
April 25, 2026 / 10:00 pm ET
Doug Horner has seen plenty of customers walk into his northeast Ohio Mercedes-Benz dealership who owe more on their trade-ins than those cars are worth. But being $40,000 underwater on a pickup truck is a scary sign of a growing trend.
A prospective buyer recently sought to trade in a Ford F-150 Lightning for a Mercedes GLE Coupe, but that potential customer owed about $87,000 on the pickup truck. Horner estimates the Ford pickup truck was worth about $47,000 — leaving the buyer well underwater.
“This is a battle that we’re fighting every day,” Horner said in an interview.
More Americans turning in their cars to buy new ones are encountering a difficult reality: Their vehicles aren’t worth what they owe.
About 30% of borrowers in the first quarter who traded in a car to buy a new one had negative equity, whereby they owe more on their loan than their car is worth, according to car-shopping website Edmunds. Those borrowers owed about $7,200 on average before getting a new loan, a 42% jump compared with the same period five years prior.
“The higher it goes, the chances are that people are never going to get themselves out of the situation,” said Jessica Caldwell, head of insights at Edmunds.
About a third of Americans trading in an older car have negative equity, which has been typical in the industry for years. But the average amount Americans are underwater has skyrocketed, Edmunds said, as buyers try to unload cars bought during the pandemic at high prices.
The increased level of negative equity represents another strain on an auto market already under pressure from pricey vehicles and elevated interest rates.
To offset those costs, more car buyers are taking on longer loan terms to keep monthly payments digestible. In the first quarter, the average loan was 70 months on new cars, according to Edmunds data. Car payments in excess of $1,000 are no longer uncommon and can stretch out more than eight years.
But consumers who are underwater on their loan end up paying more on average after rolling over the negative equity into their next car, compounding their debt even more.
The current situation dates to the pandemic’s semiconductor supply crunch, which led to a severe shortage of new cars available on dealer lots. Vehicle prices soared in response, and buyers — who either had the disposable income to spend or lacked other transit options during lockdowns — were willing to pay up.
In 2026, buyers with negative equity financed an average of nearly $56,000 for a new car in the first quarter, about $12,000 more than the typical new-vehicle buyer, Edmunds said. That translates to a monthly payment averaging $932 for negative-equity borrowers, the highest level ever recorded. In April 2021, the average new car cost about $41,000.
At the same time, the situation reflects another sign of the current K-shaped economy, where affluent individuals are thriving while others struggle. Even with the increased level of negative equity, the average trade-in equity for a car in March exceeded $6,800, according to JD Power.
“The average consumer is in a good position when buying a vehicle,” said Tyson Jominy, JD Power’s senior vice president of data and analytics. Borrowers with negative equity, however, can have a difficult time securing a loan for a new car, and it could put them at greater risk of falling behind on their payments, studies show.
Consumers who rolled over negative equity from a prior vehicle loan were more than twice as likely to wind up having their car repossessed within two years, compared with those who netted money on a trade-in, a 2024 study from the Consumer Financial Protection Bureau found.
More borrowers have been defaulting on their loan payments, which typically results in a repossession. Default rates on car loans in March rose to the highest levels seen since 2010, according to Cox Automotive, an industry-research firm.
That’s what they get for not buying 3G TL’s that last forever, so fug’m …
but in general, a lot of people can’t adhere to a budget and they constantly need to ‘treat’ themselves. Covid obviously exacerbated the problem.
Im sure there are many cases where individuals were trying to get their finances in order and timing was horrible, I’m not trying t0 say that everyone in a bad situation is entirely their fault.
But, if we compare with Japan, who are generally a lot more conservative with spending, their credit card debt did increase, but no where near what we see here and the defaults on car loans is still verily low even though unemployment did rise.
what I find is really unfair in house prices. For young couples, or new families, the cost of a house is absolutely ridiculous. We got our house in 06 which was the other housing bubble and even that, to me was stupid. But we panic bought because prices kept going and we didn’t want to get priced out.
That’s what they get for not buying 3G TL’s that last forever, so fug’m …
but in general, a lot of people can’t adhere to a budget and they constantly need to ‘treat’ themselves. Covid obviously exacerbated the problem.
Im sure there are many cases where individuals were trying to get their finances in order and timing was horrible, I’m not trying t0 say that everyone in a bad situation is entirely their fault.
But, if we compare with Japan, who are generally a lot more conservative with spending, their credit card debt did increase, but no where near what we see here and the defaults on car loans is still verily low even though unemployment did rise.
what I find is really unfair in house prices. For young couples, or new families, the cost of a house is absolutely ridiculous. We got our house in 06 which was the other housing bubble and even that, to me was stupid. But we panic bought because prices kept going and we didn’t want to get priced out.
Cars are certainly more of a luxury vs houses, though people can definitely overspend on either. Having said that, you were better off buying a house in 06 (in Florida) vs waiting until today. I've heard the story a million times of people trying to time the market and getting burned. Houses don't depreciate to extinction like cars, can last several decades if maintained well, and certainly appreciate in value, adding equity. Right now is the top of the market (again, here).
That’s what they get for not buying 3G TL’s that last forever, so fug’m …
but in general, a lot of people can’t adhere to a budget and they constantly need to ‘treat’ themselves. Covid obviously exacerbated the problem.
Im sure there are many cases where individuals were trying to get their finances in order and timing was horrible, I’m not trying t0 say that everyone in a bad situation is entirely their fault.
But, if we compare with Japan, who are generally a lot more conservative with spending, their credit card debt did increase, but no where near what we see here and the defaults on car loans is still verily low even though unemployment did rise.
what I find is really unfair in house prices. For young couples, or new families, the cost of a house is absolutely ridiculous. We got our house in 06 which was the other housing bubble and even that, to me was stupid. But we panic bought because prices kept going and we didn’t want to get priced out.
Unfair, yes but those that overpaid for a house in the pandemic house price boom have largely come out unscathed as the prices of those homes have stayed high. The exceptions are the trendy locations like Austin and Denver and parts of FL where everyone moved to during the stay home era and now have to move back to return to office.
Cars can definitely be a luxury and there are plenty of people buying things they shouldn't be, especially considering those expensive cars are the ones that depreciate the fastest. The ones I have no sympathy for are those that paid over MSRP for stuff and those that continue to do so.
Unfair, yes but those that overpaid for a house in the pandemic house price boom have largely come out unscathed as the prices of those homes have stayed high. The exceptions are the trendy locations like Austin and Denver and parts of FL where everyone moved to during the stay home era and now have to move back to return to office.
Cars can definitely be a luxury and there are plenty of people buying things they shouldn't be, especially considering those expensive cars are the ones that depreciate the fastest. The ones I have no sympathy for are those that paid over MSRP for stuff and those that continue to do so.
Yeah if you bought stuff at peak pandemic when it wasn’t necessary, sympathy is nil. But, according to Zillow, our house today is up 67% compared to 2019.
Also, expensive cars don’t depreciate fast at all, you’re just not looking high enough
Yeah if you bought stuff at peak pandemic when it wasn’t necessary, sympathy is nil. But, according to Zillow, our house today is up 67% compared to 2019.
Also, expensive cars don’t depreciate fast at all, you’re just not looking high enough
Most people aren't going crazy high but also most people are not buying GT3 Porsches that don't depreciate. They're buying big luxury trucks and SUVs that depreciate at insane rates. Also, taking out big loans with long repayment terms on a rapidly depreciating asset that you want to trade in before the loan is paid off is a terrible plan in general.
I'll also add that the people buying cars in the $200k+ range probably don't care much about depreciation. See also, every Bentley, Maserati, and Aston Martin buyer. For the most part, those that are buying in the <$150k range are going to get hit hard.
Most people aren't going crazy high but also most people are not buying GT3 Porsches that don't depreciate. They're buying big luxury trucks and SUVs that depreciate at insane rates. Also, taking out big loans with long repayment terms on a rapidly depreciating asset that you want to trade in before the loan is paid off is a terrible plan in general.
I'll also add that the people buying cars in the $200k+ range probably don't care much about depreciation. See also, every Bentley, Maserati, and Aston Martin buyer. For the most part, those that are buying in the <$150k range are going to get hit hard.
my last line there was meant to be a joke / sarcasm.
But you’re right to point out that houses can be luxury items, I wasnt referring to a house in Aspen, or Beachfront in Naples. Those can go as sky high as they want, I don’t really care.
back to car talk, what do you all think will happen to EVs? With the USA rolling back emissions and other regulations, I believe Europe backed down to a lesser extend as well.
Personally, one of the main reasons I have not taken the plunge is because the EVs I like are fairly expensive. I intend on keeping my cars a long time, but, if it gives me issues, and I want to bail out, the depreciation is going to be more than I’m willing to put up with. (Even the Nevera is dropping, so can’t even throw money at the problem! What world do we live in?)
Because we live in a townhouse, not a stand-alone home with a big garage, we don't have the infrastructure to accommodate owning an EV. Nor do we want to spend (waste) the time waiting for an EV to charge up at one of the public charging stations in parking lots at local malls, shopping centers, etc. (We hate shopping/consumerism in general, so ....)
Until this changes, it's difficult to imagine owning an EV is simply not feasible for us. So, this isn't solely a price issue, at least for my family. Then again, we've never been "early adopters" of any new tech.
Don't think I'm saying anything that folks don't already know.
my last line there was meant to be a joke / sarcasm.
But you’re right to point out that houses can be luxury items, I wasnt referring to a house in Aspen, or Beachfront in Naples. Those can go as sky high as they want, I don’t really care.
back to car talk, what do you all think will happen to EVs? With the USA rolling back emissions and other regulations, I believe Europe backed down to a lesser extend as well.
Personally, one of the main reasons I have not taken the plunge is because the EVs I like are fairly expensive. I intend on keeping my cars a long time, but, if it gives me issues, and I want to bail out, the depreciation is going to be more than I’m willing to put up with. (Even the Nevera is dropping, so can’t even throw money at the problem! What world do we live in?)
EV's are the future, there's no way around that anymore and anyone saying otherwise is kidding themselves. The US has backed down as a result of the current political climate and for reasons I won't discuss in this part of the forum, Europe hasn't really backed down at all and their sales are up. The big shift in Europe is largely away from Tesla, again for reasons I won't discuss in this part of the forum. The fact that we're pulling back on all this stuff is only going to shoot ourselves in the foot in the near future when that real shift really hits. When that happens, we'll be YEARS behind everyone else and other automakers will pull ahead of our domestic makes.
EVs are getting FAR cheaper and are cheaper than their gas counterparts in lots of markets. Depreciation isn't as bad as it used to be unless you buy a Tesla (because they randomly change the price of their new cars on a whim) and the Nevera definitely will depreciate like crazy because it's a hypercar and no one wants an electric hypercar. I wouldn't want an efficient EV hypercar that I drive 200 miles a year. I want a screaming V12 for that but definitely go the EV route for the daily driver.
All of the big car youtubers have EV's for their daily drivers, that should tell you something.
Originally Posted by nanxun
Because we live in a townhouse, not a stand-alone home with a big garage, we don't have the infrastructure to accommodate owning an EV. Nor do we want to spend (waste) the time waiting for an EV to charge up at one of the public charging stations in parking lots at local malls, shopping centers, etc. (We hate shopping/consumerism in general, so ....)
Until this changes, it's difficult to imagine owning an EV is simply not feasible for us. So, this isn't solely a price issue, at least for my family. Then again, we've never been "early adopters" of any new tech.
Don't think I'm saying anything that folks don't already know.
Are you renting the townhouse? If you're able to add a 240V plug to your garage, that's all you really need with regard to "infrastructure".
Also I think we're past the "early adopter" phase.
EV's are the future, there's no way around that anymore and anyone saying otherwise is kidding themselves. The US has backed down as a result of the current political climate and for reasons I won't discuss in this part of the forum, Europe hasn't really backed down at all and their sales are up. The big shift in Europe is largely away from Tesla, again for reasons I won't discuss in this part of the forum. The fact that we're pulling back on all this stuff is only going to shoot ourselves in the foot in the near future when that real shift really hits. When that happens, we'll be YEARS behind everyone else and other automakers will pull ahead of our domestic makes.
EVs are getting FAR cheaper and are cheaper than their gas counterparts in lots of markets. Depreciation isn't as bad as it used to be unless you buy a Tesla (because they randomly change the price of their new cars on a whim) and the Nevera definitely will depreciate like crazy because it's a hypercar and no one wants an electric hypercar. I wouldn't want an efficient EV hypercar that I drive 200 miles a year. I want a screaming V12 for that but definitely go the EV route for the daily driver.
All of the big car youtubers have EV's for their daily drivers, that should tell you something.
Are you renting the townhouse? If you're able to add a 240V plug to your garage, that's all you really need with regard to "infrastructure".
Also I think we're past the "early adopter" phase.
Right, I also suspect that depending which way the next elections will go the emission regulations will change again… also trying to tip toe around politics… but it does feel like it’s a fairly short term thing. EU are looking at relaxing the post 2035 regulations, so even if that goes through, it’s a very light adjustment by comparison. And I agree, that opens the door to Chinese manufacturers.
Regarding value drops from what I’m seeing depending on the source, the Taycan and EQ[S or E] depending on trim can drop 50% in 1-3 years. That seems to apply to the UK and EU. EV sales do seem fairly strong though.
regarding charging at home, I have some people in the neighborhood with RVs and they just charge in the driveway. They run a 240v 40A line under the garage door and plug in outside. Though, you’re in Japan, so I think you’d be at 200V like a dryer or oven.
back to car talk, what do you all think will happen to EVs? With the USA rolling back emissions and other regulations, I believe Europe backed down to a lesser extend as well.
Personally, one of the main reasons I have not taken the plunge is because the EVs I like are fairly expensive. I intend on keeping my cars a long time, but, if it gives me issues, and I want to bail out, the depreciation is going to be more than I’m willing to put up with. (Even the Nevera is dropping, so can’t even throw money at the problem! What world do we live in?)
Buy a slightly / gently used EV. Let someone else take the depreciation hit.
Buy a slightly / gently used EV. Let someone else take the depreciation hit.
stop using logic to win arguments will you? That’s not how this works
On that, though, I generally try to buy cars to keep a long time, and I don’t want to buy someone else’s problems. I know I’m painting with broad strokes here, but if I combine the car history of my parents and mine, our new car purchases have done better. Some cars are probably safer than others, for example I would avoid sport cars more than basic commuter cars, because I just assume the prior owner thrashed them. And with EVs, I just assume they have some issue the prior owner was fed up and didn’t want to deal with. If I only intend on keeping the car a couple of years, then yeah, used for sure!
As a reference, we have 3 cars, the 2 daily duty ones we have had for 18 and 16 years, the fun car for 8 years.
Are you renting the townhouse? If you're able to add a 240V plug to your garage, that's all you really need with regard to "infrastructure".
Also I think we're past the "early adopter" phase.
We own our townhouse. We don’t have a garage (street parking) which is part of the problem for us re: recharging.
As for your other remarks, I would go even further and say that the race to develop inexpensive but high quality EVs (battery technology) is pretty much over, and China has already won.
Right, I also suspect that depending which way the next elections will go the emission regulations will change again… also trying to tip toe around politics… but it does feel like it’s a fairly short term thing. EU are looking at relaxing the post 2035 regulations, so even if that goes through, it’s a very light adjustment by comparison. And I agree, that opens the door to Chinese manufacturers.
Regarding value drops from what I’m seeing depending on the source, the Taycan and EQ[S or E] depending on trim can drop 50% in 1-3 years. That seems to apply to the UK and EU. EV sales do seem fairly strong though.
regarding charging at home, I have some people in the neighborhood with RVs and they just charge in the driveway. They run a 240v 40A line under the garage door and plug in outside. Though, you’re in Japan, so I think you’d be at 200V like a dryer or oven.
The problem with the Taycan and the EQS have a few factors. 1.) they are insanely expensive for a mid size sedan and 2.) No one wants sedans anymore let alone ones that are insanely expensive and 3.) the electronics and software are garbage.
They depreciate because people don't want them and the majority of those having them are leasing. If you look at the more mainstream SUV type EV's, they aren't anywhere close to that bad. Also, getting ones where OTA updates are a regular thing and those that have good software and electronics will lead you to ones that people actually like and love driving.
The 240V is part of it, the other part is the amperage. Not sure what the normal amperage is of a 240V line overseas but a 240V/20A is not that great. It'll certainly work fine but you may not get a full charge overnight if you need it. I have a 240V/50A circuit for my charger at home.
Originally Posted by PhilB81
stop using logic to win arguments will you? That’s not how this works
On that, though, I generally try to buy cars to keep a long time, and I don’t want to buy someone else’s problems. I know I’m painting with broad strokes here, but if I combine the car history of my parents and mine, our new car purchases have done better. Some cars are probably safer than others, for example I would avoid sport cars more than basic commuter cars, because I just assume the prior owner thrashed them. And with EVs, I just assume they have some issue the prior owner was fed up and didn’t want to deal with. If I only intend on keeping the car a couple of years, then yeah, used for sure!
As a reference, we have 3 cars, the 2 daily duty ones we have had for 18 and 16 years, the fun car for 8 years.
The EV's that people have and toss at an early age are probably more so because they age out quick due to the rapid pace of advancement or because they leased them and turned it in after 2-3 years.
There's not a whole lot to thrash with an EV, hardly any moving parts lol. Battery health is something you can fairly easily determine too, most of them have built in software to tell you where it stands or you can take it to a service center and they can read it out.
In any case, if you're keeping cars for that long then the depreciation doesn't really matter... Also the drive/battery warranties on many of these are fairly lengthy at 8-10 years too.
We own our townhouse. We don’t have a garage (street parking) which is part of the problem for us re: recharging.
As for your other remarks, I would go even further and say that the race to develop inexpensive but high quality EVs (battery technology) is pretty much over, and China has already won.
Ah ok, then I would not recommend an EV for you. Having to constantly use public charging sounds like a chore that I wouldn't wish on anyone.
Agreed with your second statement which is why I think the shift in business from domestic automakers is a flawed plan that will screw them over in a few years.
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— leaving the buyer well underwater.
