New vehicles got harder to afford in September, and the monthly payment is the main reason buyers will feel it. The typical new-car payment rose 0.8% to $776, the highest since December 2023, according to the Cox Automotive/Moody's Analytics Vehicle Affordability Index released Oct. 19.
The index measures how many weeks of median household income it takes to buy the average new vehicle. That figure rose to 35.7 weeks in September from 35.5 weeks in August, the least affordable reading since January. Cox says higher transaction prices outweighed strong income growth, a slightly lower interest rate and a small rise in incentives.
Prices rose faster than incentives could offset
The average transaction price climbed 0.9% in a month to $50,562, according to Kelley Blue Book's September data, just short of the record set in December 2025. Incentives rose 2.6% to roughly $3,359, but Cox says that wasn't enough to cover the price increase, and incentives were still 8.8% lower than a year earlier. The estimated average loan rate used in the index slipped 1 basis point to 9.45%, based on a 72-month fixed-rate loan.
There is one bright spot. Compared with September 2025, affordability actually improved 2.5%, when it took 36.5 weeks of income to buy the average new vehicle. Incomes grew 3.8% over the year and rates were lower, which more than offset prices that were up 0.7%. The payment is the exception: it is 1.3% higher than a year ago, though still below the $795 peak of December 2022.
New-vehicle affordability, September 2026
| Measure | September | Change |
|---|---|---|
| Weeks of median income needed | 35.7 | Up from 35.5 in August; least affordable since January |
| Typical monthly payment | $776 | +0.8% month; +1.3% year |
| Average transaction price | $50,562 | +0.9% month; +0.7% year |
| Average incentive | About $3,359 | +2.6% month; -8.8% year |
| Estimated average loan rate | 9.45% | -1 basis point month; -9 points year |
Sources: Cox Automotive/Moody's Analytics Vehicle Affordability Index; Kelley Blue Book September ATP tables. Loan rate reflects a 72-month fixed-rate loan.
Among mainstream brands, Kelley Blue Book's tables show Toyota's average transaction price at $44,539 in September, up 4.9% from a year earlier, while Honda's average was $38,224 and Hyundai's was $37,316, both slightly lower year over year. The average compact car sold for $27,977, up 3.2% from September 2025.
Used values steady, led by compact cars
On the used side, wholesale prices firmed in the first half of October after a soft September. The Manheim Used Vehicle Value Index rose 0.7% to 207.4 through Oct. 15 and is 2.2% above last October. Unadjusted wholesale prices still fell 2%, which is close to the usual seasonal drop.
Cox senior director Jonathan Gregory said the firmer values come from tighter supply, not more demand. Wholesale days' supply fell from 28.7 to 28.2. "The firmer values reflect leaner inventory rather than stronger buying," he said. Gregory added that fuel efficiency and affordability continue to drive which segments hold value: compact cars are up 5.6% from a year ago and midsize cars have turned positive, while pickups remain soft. EV values are up 6.8% over the year but slipped 0.7% so far this month as more off-lease EVs reach the market.
What it means if you're shopping now
Gas is part of the picture. AAA's national average for regular was $4.26 on Oct. 21, down from $4.48 a month ago but still more than $1.20 above a year ago, and that keeps demand strong for small, efficient cars. For buyers, it means a compact sedan or hatchback is cheaper up front but won't be a bargain on the used market, while a used pickup or luxury model may offer more room to negotiate.
With new-car incentives below last year's level, shoppers who need a lower payment should compare the full loan cost, not just the monthly figure, and get a credit union or bank quote before visiting a dealer. The next affordability index update is due Nov. 16, and the full-month Manheim reading arrives Nov. 6.
