Clues That Tell You Which Cars are in High Demand

To get the best car deals, it's important to know the supply and demand dynamics of your desired vehicle.

Most consumers don't realize how much this can affect the price. The higher the demand or lower the supply, the more you're going to have to pay - it's as simple as that.

Cars in high demand command prices that are equal to or sometimes even greater than MSRP. Some dealers have gotten away with adding thousands of dollars in "Additional Dealer Markup" to the price, which is nothing more than a "suckers" fee.

If you're the type of person that just has to have the first "new thing" on the block, then go for it - but realize that you're paying thousands of dollars for that privilege. So how do you tell which cars are in high demand?

First of all, practically every newly redesigned or newly introduced model experiences high demand during the first few weeks or months that it arrives in showrooms. The manufacturer is busy producing as many as they can - as quickly as possible, but demand from "first on the block" consumers far outweighs the supply.

When Smart cars were first introduced in the US, dealers couldn't keep them in the showrooms - consumers were paying over MSRP to get their hands on one. Months later, demand dried up and Smart sales fell over 50%. Along with it came drastic price cuts - I even saw a $99/month lease deal on them. This type of scenario plays out constantly, which is why it's worth it to wait a few months before buying a high demand vehicle.

Another clue to look out for are when dealers advertise availability rather than price on a particular vehicle. They do this only when they know inventory levels are low and consumers can't find what they're looking for. In all likelihood, they probably don't have good selection either, but their goal is to get you in the showroom where they can try to pressure you into a different vehicle.

Bottomline: whenever you feel there isn't enough inventory to choose from, you're shopping for a high demand/low supply vehicle. Waiting several months will be your best option if you really want the car, but also don't want to overpay for it.

Finally, check out my list of Cars You Should Wait to Buy, which I update monthly. It shows the new cars selling for the biggest markups right now.