USED car values are up 13 per cent year on year, according to BCA’s Pulse Report for February.
Average used car values stayed above £7,000 for the third month in a row, says BCA, with cars averaging £7,056 across the board – significantly ahead of February 2012, if slightly behind January 2013.
February 2013 actually recorded the third highest monthly average since BCA’s reports began in 2005, with fleet and lease values in particularly reaching new heights. Average part exchange values also stayed strong – above £3,500 for the third consecutive month.
‘The rise in average prices at the ‘value-for-money’ end of the market must be a reflection of the current economic conditions. As household budgets remain squeezed, the increased demand from motorists for affordable transport is driving values upwards,’ commented BCA’s operations director, Simon Henstock.
‘There is likely to be continued demand for ‘budget motoring’ from drivers who simply cannot afford to buy a more expensive car, but still need personal transport and need it quickly, because their current vehicle has become too expensive to run, repair or maintain.
‘Despite values being at record levels, however, there remains an underlying fragility in the marketplace reflecting the difficult on-going economic conditions. Prices are high largely as a result of the constricted supply and, seasonal variations aside, we should expect a similar picture across much of 2013.’
Henstock suggested however that, while strong average values are the current norm, the market may not be able to sustain such growth as time goes on.
‘We know from experience that values cannot keep rising and there will inevitably be an adjustment,’ he said. ‘How this will manifest itself is impossible to judge at this stage, but with the Easter break often representing a watershed in demand we might see some pressure on values in April.
‘With the March plate change now in full swing and more confidence in the retail new car market, we expect to see significantly higher volumes and much greater choice for buyers at auction over the next few weeks.’