7:25 am, October 22, 2021
The average price of the most popular second-hand cars has risen by close to 60 per cent in just two years, new data from the AA has shown.
Prices are currently sky high due to supply line issues which have affected the production of new cars, such as the global semiconductor crisis.
As a result, demand for some used models has become so strong that they are now starting to appreciate with age.
Research by AA Motors found that a three year-old Mini Hatch now costs 57 per cent more than a model of the same age cost in 2019.
Also, a five year-old model currently costs 15 per cent more than a three year-old car did in 2019, meaning it has gained in value despite getting two years older.
The analysis, of the 30 most searched for cars on the AA Cars platform, compared prices of three, four and five year-old models in August 2019 and August 2021.
Britain’s most popular car – Ford Fiesta – saw the average price of three to five year old models jump by nearly a third (31 per cent) to £9,770 between 2019 and 2021.
Elsewhere, while the Mini Hatch claimed the crown for the fastest rise in prices, other models have also appreciated even as they got older.
Toyota Aygo owners who bought a three-year-old model in 2019 could find their car is now worth 11 per cent more, while Volkswagen Golf owners have made a similar profit of 9.5 per cent.
Surging demand and finite supply have combined to push up used car values sharply over the past two years.
The first easing of lockdown restrictions in summer 2020 unleashed demand that had been pent up during the early stages of the pandemic.
Demand accelerated again in 2021 as the economy improved and many people opted to drive rather than take public transport.
James Fairclough, CEO of AA Cars said: ‘With the exception of houses and some classic cars, things rarely go up in value as they age.
‘Yet price growth in the used car market is so strong that some in-demand models are appreciating even as they sit on the driveway.
‘But even though average prices have risen sharply over the past two years, it is still possible to get a good deal on the second-hand market.
‘We advise anyone who is in the market for a used car to shop around widely and, when they have narrowed their search, to ask the dealer questions about the specific vehicle they are interested in.
‘If they find out it has been sitting around on a forecourt for a while, the dealer may be more inclined to offer a price reduction.
‘We always recommend that an independent pre-sale vehicle inspection takes place on any second-hand car before any money changes hands, to ensure drivers can have peace of mind that there are no hidden faults which will cost them money down the line.’
