New year, used (car) surprise.

In a twist to start 2026, demand for used cars was at its highest level for January in five years, according to the latest CarGurus Intelligence Report.

The CarGurus Used Vehicle Demand Index was at 109.7 in January, which beat December’s reading by 4.0% and was up 7.2% year-over-year.

Last month was the strongest reading of that index since January 2021, CarGurus said.

“Used sales demand came out roaring in January, with savvy car buyers taking advantage of a month that typically offers lower prices, higher inventory, and less shopper competition before the market heats up during the tax-season rush,” said Kevin Roberts, director of economic and market intelligence at CarGurus, in the analysis released Wednesday.

“The key question now is whether this early surge signals sustained momentum,” said Roberts, who authored the report. “If this trend holds, it could set the tone for a competitive start to the spring selling season.”

Buyers in the South and West helped push used-car demand, which CarGurus notes could have been even higher had it not been for the multiple bouts of wintry weather in January.

Looking at additional metrics in the report, the CarGurus Used Vehicle Availability Index was down 0.3% from December, but up 5.2% year-over-year, coming in at 99.4. This gives dealers plenty of used cars for the upcoming tax season, which could spur more demand.

While down 1.0% from December, average used-car listing prices climbed 1.5% from January 2025, driven by increases in demand, CarGurus said.

They’re likely to bounce back further as demand grows.

Oddly enough, even with consumers clamoring for used cars, the average amount of time they’re sitting on dealer lots (77.2 days last month) is up 1.3% month-over-month and year-over-year, according to CarGurus.

Silver lining, though, the company contends that dealers are “positioned to match stronger demand,” with used-car days supply at 49.7.

That was “only slightly” softer than December (2.1%) and year-ago (0.7%) levels.

“Despite the surge in demand, used inventory levels continued to rise with the CarGurus Used Availability Index increasing 5.2% YoY,” Robets said. “Growing inventory hasn’t done much to ease prices, which averaged $27.8K in January, up 1.5% compared to a year ago. We expect prices could begin moving higher in the coming weeks as seasonal demand continues to build.”