As most iPhone devotees eagerly anticipate the arrival of the new iPhone 5, it might pay to sell your iPhone 4S now—especially if you can survive a couple of weeks without either one.
With the iPhone 5 widely expected to hit stores around Sept. 12, analysts foresee some major structural changes. “There’s a lot more hype this time around, with speculation about a larger and slimmer screen,” says Anthony Scarsella, chief gadget officer at technology resale site Gazelle.com. As the release day gets closer, the market is likely to be flooded with old iPhones; 84% of people who previously traded in old iPhones are already preparing to do so again, according to a survey of 1,400 Gazelle customers. But in the past, those floods have turned into gluts, typically causing prices to drop by 20% to 25%, says Jeff Trachsel, chief marketing officer of resale site NextWorth.com.
The takeaway: Current prices probably represent a peak. And those who bought their iPhones for $199 as part of a two-year wireless contract might actually stand to make a profit.
Prices vary on the resale sites. For a 16-gigabyte iPhone 4S, Gazelle will pay $270, NextWorth offers $263 and Amazon Trade-In prices go up to $290. But for many phone owners, the more important factor is the “lock-in”—the amount of time the seller gets to keep the gadget before sending it in. Amazon Trade-In wants the iPhone within seven days to guarantee its agreed price, NextWorth gives 21 days grace, and Gazelle pledges 30 days.
Consumers can also auction off their own iPhones on eBay. The sale prices trend much higher—but sellers typically have to ship their phones immediately. Currently, 16GB iPhone 4S models are posted with asking prices of $500 to $650, though there’s no guarantee sellers will get those higher prices. Overall, eBay says, there’s been a 70% rise in the number of smartphone trade-ins on the auction site this month. Since July 30, over 185,000 trade-in offers have been generated, an eBay spokesman says.
What to do if a resale deal leaves you temporarily phoneless? Some carriers, such as AT&T, allow you to buy a SIM card that’ll enable you to reactivate an old phone; you could also turn to a temporary, cheap pay-as-you-go phone from a vendor like Verizon, T-Mobile or AT&T. With either solution, resellers are still likely to come out ahead financially compared with those who wait longer.