Trade-in values for used cars are expected to peak in the next few weeks, according to the National Automobile Dealers Association Used Car Guide.
Rising gas prices, dealer inventory shortages and strong consumer demand for fuel-efficent vehicles are boosting prices for compact and midsize cars.
Values for those vehicles grew by an average of $300, or 2.6 percent, from March to April; and by an average of $500, or 4.3 percent, since the beginning of the year, according to the NADA Used Car Guide.
Some vehicles have seen double-digit percentage increases in their trade-in values. The average trade-in value for a 2011 Kia Rio was $7,700 in January and $9,100 in April, a 15 percent increase, the NADA Used Car Guide says. The average trade-in value for a 2009 Toyota Prius rose 12 percent to $15,675 in April from $13,750 in January.
"Clean, late-model used vehicles under 6 years old with reasonable mileage will command top dollar," Jonathan Banks, executive automotive analyst for the Used Car Guide, said in a press statement.
The guide forecasts used-car prices will decline in June and the rate of decline will pick up over the second half of the year.
High trade-in values for used cars are a reminder for consumers to think carefully before dropping collision and comprehensive car insurance on older vehicles. Collision insurance pays for repairs or replacement of a vehicle damaged in a car accident, and comprehensive covers losses from other causes, including theft, vandalism, natural disasters and collisions with animals.