Sunday, January 20, 2008

How One Car Seller is Using PriceHub on Craigslist

This weekend, a PriceHub user brought a particular car ad on Craigslist to my attention. While this ad for a Lexus RX300 was similar to the 100 or so other ads for the same car, it was different in one way. In the vehicle description, the seller mentioned that his asking price was fair, based on the actual prices he had seen on PriceHub. He then linked his ad to the PriceHub actual sale prices for the Lexus RX300. Because these actual sales prices were submitted by real people, the seller felt his asking price was more than fair since it was based on real data, not a best guess calculated from a pre-determined formula.

In my experience, this is the first time that I've seen a seller use actual car sale prices to justify their asking price. Sellers commonly use KBB or Edmunds.com to provide price justification, but I personally discount these estimates since they are so broad. Depending on which price the seller decides to use from KBB or Edmunds (trade-in, private party, or dealer retail), the range of prices for a given make/model of a car can really vary. For example, if a seller says that they are pricing their car "way below blue book", I automatically assume that they are using the 'dealer retail' price as their basis, which is always the highest price quoted.

It is our hope that PriceHub can bring a new level of transparency to the car buying and selling process. This RX300 ad from Craigslist is a good indication that this new level of transparency is starting to gain some momentum.

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