11:49 am, June 23, 2023
Used car prices have risen 3.5 per cent on this time last year as train strikes put people off public transport.
Auto Trader’s latest used car pricing for June shows prices have also risen 0.3 per cent on last month.
That rise is very unusual for this time of year when traditionally used car prices fall. In June 2019, prices dropped 0.9 per cent.
Older used cars are rocketing the most – with vehicles over 10 years old up nine per cent on this time last year.
Auto Trader says the unexpected rises are down to a combination of things including an increasing importance placed on car ownership because of strikes impacting public transport.
The growth in used car prices – one of the factors that’s been named by the Office of National Statistics to be fuelling inflation – has also been driven by reduced numbers of cars in the market pushing up values.
Auto Trader says used car stock numbers on its website are down nearly five per cent on June 2022 while at the time consumer interest remains buoyant, despite rising interest rates and the cost of living crisis.
Used electric car prices, though, are still tanking with values of EVs down 18.4 per cent on this time last year.
Auto Trader’s director of data and insight Richard Walker said: ‘Although the economic backdrop is a concerning one, based on our metrics, the growing squeeze on household finances, which will be exacerbated by the latest rise in interest rates, is having a limited impact on car buying demand.
‘Despite potential headwinds, our consumer research supports a cautious, but optimistic outlook for the months ahead.
‘Cars are, for the vast majority of motorists, a fundamental need, as opposed to a discretionary luxury, so we believe the used car market will largely be shielded from wider economic disruptors.’
Auto Trader said 77 per cent of 2,000 users it surveyed said they will buy a new car in the next six months, a stat that remains consistent with previous levels despite current economic headwinds.
Some 96 per cent of those surveyed said a car is important to their household to own while 47 per cent said it is now more important than ever.
Nearly half said ownership of a car was vital because of the recent disruption to public transport.
This has led to the amount of time it takes to sell a used car on average dropping a day – to 27 in June, from 26 in May – some six days faster than pre-Covid.
Auto Trader’s pricing data comes from looking at the prices of 800,000 used cars. It monitors 116,000 vehicle updates every day.
