Used car prices dropped just £22 on average across the whole of the market in the first week of August.
Used car pricing experts Cazana have noted there were fewer used car buyers in the market but demand was still strong, keeping prices buoyant.
The valuations experts reports that prices dropped just 0.13 per cent in the week – taken from the average of advertised retail used car prices.
Cazana director of insights Rupert Pontin said the start of the holiday season and the good weather has seen enquiries drop at car dealers – but said that is ‘hardly surprising’.
He added: ‘The first week of August saw a marginal shift in the retail market with footfall at the retailers and online enquiries slightly down on the levels of recent weeks.
‘This is hardly surprising given it is the holiday season and secondly the improvement in the weather, that looks set to continue throughout the month, has given consumers the incentive to spend a little time on holiday rather than staying at home.’
Used car prices have been climbing since lockdown as a combination of high demand, little stock and consumers looking to avoid public transport buy a used vehicle instead.
However, Cazana says this marginal drop in prices – albeit small – needs to be noted by dealer groups as it may signal the start of a trend.
Pontin said: ‘While this drop-in price is hardly noticeable in some people’s eyes, across a retailer group this dip would have made a costly difference.
‘This should also serve as a market yardstick and one that should be watched closely going forward to avoid financial challenges as the market shifts as is expected later in the year.’
Cazana said that there is ‘pricing volatility’ in the market to be concerned about too with different market sectors and fuel types seeing huge price swings from one week the next.
Pontin said: ‘This is another indicator that the coming weeks might be a little more challenging than of late.’
Cazana’s analysis of used car prices for the first week of August shows that older petrol cars had the largest price increase – up 3.35 per cent.
Meanwhile, older diesel powered sports cars dropped 5.15 per cent in the week.
Pontin added: ‘To summarise, it would seem that there has been a subtle shift in the market both from a consumer demand and pricing perspective.
‘At this point, there would appear to be little to be concerned about, but it is key to ensure that all market insight is analysed in detail to make sure there is a full understanding of market conditions.’