Unprecedented rise of used car prices
Used car prices have increased by a staggering 13.5% in the last three months.
According to data from cap hpi, values increased 4.8% at the three-year point during the month of June, equivalent to over £625 per car.
This rise follows the two per cent increase during April and 6.7% increase in May, signifying that on average, values have increased by an incredible £1,700 or 13.5% in the last three months.
This rises to £2,500 for one-year old cars over the same period.
Derren Martin, head of valuations at cap hpi, said: “Consumer demand has remained very strong in June, despite half-term, great weather, and Euro 2020 to distract people. With stock-turn high, this has led to retailers requiring a constant supply of cars to replenish their forecourts. Well-documented new car supply issues resulting from several component shortages, have led to fewer fleet returns and part exchanges. This has caused demand to outweigh supply for the third month running.”
However, the current rise in used car values in the trade arena have not done so to the same degree in the retail sector. This makes it difficult for the trade to buy cars working back from retail advertised prices.
Martin concluded: “With new cars being in such short supply and likely to continue to be so for at least the next quarter, there is no bow wave of fleet returns coming through. One million less cars have been registered than would reasonably have been forecast over the last 18 months. These cars are lost to the used car market. It will be a while before supply outweighs demand again.”
