10:52 am, November 25, 2021
Used car values fell in November for the first time in 10 months – but there’s no need to panic.
That’s the view from Cap HPI. In an exclusive interview with Car Dealer, the firm’s head of valuations Derren Martin said used car values fell by 1.2 per cent in November – the first drop in values since February.
However, with values rising 1.2 per cent in October, November’s fall shows the market has plateaued and not crashing after a nearly a year of value gains.
In the video at the top of this story, Martin said: ‘The headline for November – and which goes towards our December monthly values – is a 1.2 per cent drop, which is equivalent to a £230 fall on average.
‘It’s the first drop that we’ve seen in our Live values since February.’
Martin went on: ‘That’s one way of looking at it, though – the other way is it’s not a massive movement down.
‘It’s the second most positive movement we’ve made going into a December since we introduced Live values in 2012. Some normal seasonality is what we’re calling it.’
The fall in November is against a backdrop of values rising by a whopping 30 per cent during 2021.
‘Dealers tell us they have seen demand drop, but you have to look at this in context with previous years rather than what’s happened over the past few months.
‘Demand for used cars has been unbelievable for the last few months and that’s starting to drop away.
‘Around this time of year, consumers switch off from making big ticket purchases and concentrate on Christmas.’
Martin added: ‘Consumer demand is still there – it’s just not as high as it has been over the past few months.’
For much of 2021, MPVs have been one of the most desired types of used cars – and November was no different.
Values for most MPVs remained level in November, but the largest people-carriers have again got up in value – a trend seen frequently in 2021.
Martin revealed that values for electric cars stood out in particular.
Models like the Nissan Leaf, Hyundai Ioniq and Jaguar I-Pace all posted rises in November.
‘My electric vehicle editor said that 2021 will probably be remembered as the year that electric vehicles were considered a lot more by used car buyers.’
Martin said he expects the semi-conductor crisis to continue to affect new car supply ‘well into next year’ which will help keep used car values high.
It’s for this reason he believes values will drop during Christmas, and then ‘stabilise’ into 2022.
