Falling used car prices have once again hit national airwaves as one valuations expert has said ‘now is a good time to buy’.
BBC Radio 4’s consumer programme You and Yours covered the used car market on its show today (Dec 11), showing that the topic has moved from being discussed by motor trade experts and publications – such as Car Dealer – to being covered on a wider consumer level.
Presenter Winifred Robinson was joined by chairman of the Independent Motor Dealers Association (IMDA) and recent Lifetime Achievement award winner, Umesh Samani, and Cap HPI’s director of valuations Derren Martin, who both gave colour to the current used car picture.
Martin explained why trade used car prices have fallen in recent months, and remarked December, and in particular January, is a good time for used car buyers to spend their cash as recent prices falls are ‘stabilising’ but still on the downward trend.
‘It’s seasonal – you tend to get values dropping as soon as you get into the run-up to Christmas as people are focusing on spending their money elsewhere,’ Martin explained.
‘What’s happened this year, though, are cost-of-living concerns, fixed price mortgages coming to an end, fewer people looking to buy a car, and dealers wary about stocking up.
‘Used car prices are very much down to “supply and demand”. Supply has increased due to new car supply increasing, and there are more cars coming back to the market through more part-exchanges, fleet returns and company cars.
‘Supply has increased and demand has decreased and, very simply, prices started to drop. Used cars were also very expensive as they went up by so much in 2021.’
Martin added that prices for used electric vehicles and SUVs had dropped ‘quite considerably’, but prices are falling ‘across the board’.
Meanwhile, Samani, insisted the falling of trade prices of used cars was a ‘correction’ and that retail prices aren’t falling at a similar rate.
‘Retail prices are coming down but it takes a bit of time – five or six weeks before it [the drop in trade prices] materialises in the retail market.
‘I’m not seeing a massive decrease in retail demand. The prices are a realignment as there were very, very high, which now makes some used cars look like good value for money. Retail prices are coming back to more realistic prices.’
Replying to Robinson’s question on whether used car prices might come down even further and should customers buy now or wait until after Christmas, Martin replied: It’s a good time to buy now.
‘The price drops we saw in October and November have stabilised to a degree so far in December.’
Falling retail used car prices have been covered in depth by Car Dealer.
Values again dropped 4.2% in November, Cap HPI told Car Dealer’s James Baggott in a special video interview – you can watch this at the top of this story.
Meanwhile, dealers have been messaging Car Dealer’s editorial team saying retail prices are not falling as fast as trade guides have suggested.
Umesh Samani was speaking just two weeks after been honoured at the Car Dealer Used Car Awards 2023.
Samani, who has been running his own used car business for nearly 30 years, was celebrated by his peers as he collected the coveted Lifetime Achievement award.