First it was houses, then Bitcoin – now used cars sat on people’s drives could be their latest appreciating asset.
For years, the assumption was that cars depreciated, but in this topsy turvy world post lockdown, used cars are actually going up in price.
The used car market has gone crazy since the start of the year with some models rising in value by as much as 35 per cent.
Owners of some popular cars – like the VW Golf R and BMW M140i – have seen their cars rocket in value.
Auction firm Motorway says it has seen prices of Golf Rs rise by a staggering £4,853 in just six months – up 35.9 per cent.
A perfect storm of fewer new car sales resulting in less part exchanges, coupled with increased demand from buyers looking to spend lockdown savings, has sent the used market into overdrive.
Car Dealer has spoken to valuations experts who are seeing near-daily rises in the prices of some used models.
Motorway – the trade auction site that lets consumers sell their cars directly to dealers who bid to buy them – says the average price of used cars is up 8.2 per cent since November.
Back then the average price of cars sold on its platform, excluding those under £5k, was £14,126.
Now, in May, that’s gone up by £1,170 to £15,296.
‘The average increase that we have tracked is a solid upwards stat,’ said sales director James Bush.
And Motorway’s findings are not unique.
The sticker price on dealer forecourts has also seen an upwards trajectory, says valuations firm Cazana.
At the end of April, its data found the average price of a used car was £13,593 – up from £12,125 in November.
It says prices have risen 12.1 per cent during that time with used car owners seeing their cars rise by nearly £1,500.
Car dealers across the country are struggling to replenish their forecourts as demand post lockdown has seen buyers flood to showrooms.
Many fleet and leasing companies are also holding on to their cars as new car supply begins to be hit by the semiconductor shortage causing problems with production.
This is only serving to reduce the available stock further.
Cazana has found petrol models are up £1,472 on average while diesel models are up £1,072 since November.
In some cases dealers are offering to beat the price offered by sites like WeBuyAnyCar by as much as £1,000 just to get stock on their forecourts.
‘The way that demand is currently exceeding supply that is likely to rise further by the end of May,’ said Martin Potter, auction firm Aston Barclay’s MD.
Cap HPI believes used car prices will rise five per cent in April and May.
Derren Martin, head of valuations for CAP HPI, said: ‘As always, when supply is constrained and demand strong, prices increase.’
Motorway’s top appreciating used cars (trade)
VW Golf R DSG – up 35.9%
- Price in November 2020: £13,533
- Price in May 2021: £18,388
BMW M140i – up 10%
- Price in November 2020: £20,583
- Price in May 2021: £22,647
Volkswagen Golf GTD – up 8.7%
- Price in November 2020: £11,384
- Price in May 2021: £12,373
Jaguar XE R-Sport – up 7.8%
- Price in November 2020: £11,198
- Price in May 2021: £12,073
Ford Fiesta Zetec – up 7.59%
- Price in November 2020: £5,535
- Price in May 2021: £5,955
Cazana’s top appreciating used cars (retail)
Mercedes Benz GLE diesel – up 6.2%
- Cash rise since November: £1,901
Mercedes CLS Diesel – up 5.9%
- Cash rise since November: £1,382
Nissan Leaf – up 5.7%
- Cash rise since November: £809
Kia Pro-Ceed Diesel – up 4.3%
- Cash rise since November: 400
Jeep Compass Diesel – up 3.6%
- Cash rise since November: £500
For more used car stories like this visit our dedicated section.