HOUSTON - Car prices are expected to spike again now that Hurricanes Ida and Nicholas have left hundreds of thousands of cars damaged from floods. That will make the car shortage worse and increase car buyers' risk of buying damaged vehicles.
CARFAX estimates Hurricane Ida damaged 212,000 vehicles in the U.S. That’s on top of 378,000 already on the roads from previous storms. Houston has the most, with nearly 34,000 vehicles.
New and used car prices have already been soaring. Used car prices are up 32% over last year due to a vehicle shortage.
Throw in Ida and Nicholas. With 212,000 new and used cars damaged, prices for vehicles that weren't damaged are expected to climb even higher.
After Hurricane Harvey flooded 500,000 vehicles, used car wholesale prices shot up 3%.
Meanwhile, flood-damaged cars will be cleaned up and put on the market as well.
"The market is so stretched thin for inventory, it creates an opportunity for these cars to be put back on the market, cleaned up quickly, and resold to people who don’t know they were damaged," explained CARFAX spokesperson Chris Basso.
That creates safety issues.
"These cars are ticking time bombs and it’s a matter of time before that water begins to break down the car," he said.
It also means higher repair costs, higher insurance costs, and lower resale values.
"It really raises a red flag for consumers that are in the market right now for a used car," said Basso.
Here are red flags to look for:
"Look at the seat belt, the seat rails. See if there’s any rust that’s formed on there that may indicate water damage," said Basso. "Look for any dried mud or silt under the dashboard or around the pedals. Look for stained carpeting or even those perfumey smells meant to mask that mildew smell."
Also, turn on the ignition to see if all of the indicators on the instrument panel light up. Make sure the lights, air conditioning, windshield wipers, and turn signals all work properly. And look for fog or moisture beads in interior lights.
Before buying, have a mechanic check the car and pull the CARFAX report on the vehicle's history. You can also enter the VIN on the CARFAX Flood Check page to see if flood damage was reported.