For most of automotive history, a seven-year-old sedan or pickup was a depreciating asset and nothing more. A car you bought in 2019 and drove through the pandemic should, by every conventional measure, have depreciated heavily by now.New data from Edmunds’ July 30, 2026, positive equity report suggests that assumption no longer holds. Average positive trade-in equity toward new-vehicle purchases hit an all-time high in the second quarter of 2026, and the dollar figures have climbed or held near record levels for four consecutive years.The vehicles generating the strongest equity positions are not high-end models traded in after short loan terms; they are the everyday cars and trucks that fill driveways across the country.How cars from around 2018 to 2020 became the trade-in equity sweet spotThe pandemic broke used-car pricing between 2021 and 2022, when global chip shortages choked new-vehicle production across every major automaker.With almost nothing new on dealer lots, buyers flooded the secondhand market and pushed used-vehicle values to levels no one had anticipated. By the first quarter of 2022, a record 83.6% of all trade-ins toward new purchases had positive equity, the Edmunds report found. The share has since pulled back to 68.8% in the second quarter of 2026, which is closer to historical norms but still above the pre-pandemic era. More Automotive:Car owners caught in government fight that could cost them bigFord begins testing tech that will change Americans’ minds about EVsEdmunds sees major shift on used car pricesWhat has not pulled back is the dollar amount. Average positive trade-in equity reached $13,330 in the second quarter of 2026, an all-time high, according to the Edmunds data. Owners who bought during the tight-inventory era often paid sticker or above, but sustained demand kept resale values from falling back to historical norms.The result is a specific sweet spot: Owners who purchased mainstream models around 2018 to 2020, signed conventional 60- or 72-month financing terms, and steadily paid down their balances have largely cleared the steepest section of the depreciation curve, while their cars retained more value than anyone projected.The mainstream vehicles delivering the largest equity gainsIt would be easy to assume that record equity numbers are driven by expensive luxury vehicles traded in after short ownership periods with large payments. Instead, the data show that the top 20 most frequently traded-in vehicles with positive equity are overwhelmingly mass-market models. The kind of seven-year-old Civics, Tacomas, and Silverados that millions of people drive to work every day.Because secondhand values for reliable used vehicles remain elevated, these everyday owners are routinely arriving at dealerships with five-figure equity positions, the report showed.Selected mainstream models from Edmunds’ 20 most-commonly-traded-in vehicles with positive equityGMC Sierra 1500: $22,217 (2020.4 average model year) Ford F-150: $17,876 (2018.5 average model year)Ram 1500: $16,988 (2019.7 average model year)Toyota Tacoma: $16,755 (2019.7 average model year)Chevrolet Silverado 1500: $16,544 (2019.3 average model year)Toyota Highlander: $14,415 (2018.6 average model year)Toyota RAV4: $11,194 (2019 average model year)Honda CR-V: $10,545 (2019.3 average model year)
Source: Edmunds second-quarter 2026 trade-in data
Full-size trucks top the list because their strong resale values and high original purchase prices create substantial dollar-value equity once loans are paid down. Even mid-priced crossovers like the CR-V and RAV4 are delivering five-figure equity for their owners, which would have been rare before 2020.Those equity positions matter even more once you factor in what today’s borrowers are paying to finance their next vehicle.
Mass-market vehicles, not luxury cars, are generating the biggest trade-in equity, as strong used-car values leave many owners with five-figure gains.PixelsEffect / Getty Images
Why higher rates raise the stakes on both sides of the trade-inThis surge in positive equity could have a greater impact on your next car purchase than at any point in the last decade.Among shoppers who returned to the market with positive-equity trade-ins, average annual percentage rates on new-vehicle loans reached 5.9% in the second quarter of 2026, up from 3.8% in the same period of 2016, the data showed.Within that same positive-equity trade-in cohort, average monthly payments rose $228 between Q2 2016 and Q2 2026, a shift that raises the value of a larger down payment.A July 16 Edmunds report on Q2 negative equity cautioned that not everyone benefited from the value surge, however. Head of Insights Jessica Caldwell said buyers who financed during the pandemic-era price peak are increasingly returning with underwater loans.Consumers are incurring more debt than ever when trading in vehicles that are underwater.”Buyers who financed at 2022’s peak prices are starting to come back to trade in, and they’re bringing thousands of dollars in old debt with them,” Caldwell added. “With interest rates still elevated, this is creating a costly snowball effect for consumers.”Edmunds analysts note that owners in that position could roll the equity into a down payment, which would shrink the new loan’s principal and lower the monthly payment.Picking a vehicle that fits your needs with the right financing terms will save more money in the long run than chasing any temporary manufacturer discounts or dealership incentives, Edmunds’ Ivan Drury noted.How 2018 and 2019 owners can check their equity in minutesThe biggest barrier to capturing trade-in equity has traditionally been the hassle of getting accurate estimates from multiple dealerships in person. Edmunds’ instant appraisal, available on Edmunds.com and via a ChatGPT plugin, now returns up to three competing dealer offers after a shopper enters a vehicle identification number (VIN), mileage, and condition details, according to the firm.Edmunds analysts say owners of mainstream models from the 2018 and 2019 model years are among those most likely to find equity they did not expect. Owners concerned about looming major repairs on a high-mileage car may want to check values while it still runs well, Drury indicated.The post-pandemic pricing environment has not fully reset, and for one group of everyday car owners, that lingering distortion is working in their favor.Related: Edmunds sees major shift on used car prices