Used Car Prices Expected to Drop Next Year

The reason: there will be an additional 600,000 off-lease vehicles returning to the maket in 2013 than in 2012. With such a big spike in supply, there's going to be downward pressure on prices.

Some brands, such as Mercedes, are expecting nearly a two-fold increase in the number of off-lease vehicles in 2013 compared to this year. Others, such as Toyota, say their lease-returns won't spike until 2014. GM will start seeing an increase in lease-returns beginning in December of this year and see a larger increase towards the end of 2013.

Most of these vehicles will be coming off of 2 or 3-year leases, so the downward pressure will be felt mostly on late-model used vehicles, but the impact should also affect overall used car prices as well.