The Canadian public feels happy as car prices have decreased for the first time in years.

Daniel Ross, the senior director of industry insights at Canadian Black Book, stated that car prices at dealerships have started to decline, and affordability is improving.

He added, "The new car market is returning to normal faster than the used car market. There is an inventory of cars, and there are incentives depending on where you shop. If you are a new car shopper, this is the best position you've faced in a long time."

A buildup of new car inventory nationwide has resulted from rising prices of newer models and consumers shying away from big purchases amid high inflation and rising interest rates. Now, manufacturers and dealers have launched incentives and discounts in their efforts to clear this inventory.

Shari Primack, senior advisor at the nonprofit Car Help Canada, explained that homeowners monitor every move by the Bank of Canada as they hope for lower borrowing rates. However, buying cars works a bit differently; when financing through a dealership, the interest rate depends on the specific model or make.

He said, "The rates set by the manufacturer are primarily linked to the availability of the vehicle. If cars have a very good supply, it will stimulate interest rates and lower prices. However, if the car has no supply and has a long wait time due to supply shortages, interest rates will not be stimulated."

He noted that as the availability of vehicles continues to improve, more incentives and deals are being offered to customers, enhancing their negotiating power.

But the market has not fully corrected yet, and it may take another year before it returns to normal.

Primack suggested that it would be ideal to wait another six months to secure a better deal on new cars—especially for vehicles with lower availability and longer wait times that won’t get good incentives from manufacturers.

He said that North American automakers, including Ford, General Motors, and Stellantis, have larger inventories and may have better deals and incentives for customers. European luxury brands, including Mercedes, BMW, and Audi, can also be good options for getting discounts.

Primack also suggested looking for vehicle models, shopping for the best price quote from a dealer in advance, and requesting a detailed breakdown of the quote to ensure the shopper is not paying for additional products.

Ross commented on the car market: "It's a better scenario than it was before. If you want my advice on buying a car, I would tell you not to buy now unless you really have to."