Used car prices have surged to the highest point since April 2009, according to Cap HPI’s head of valuations Derren Martin.
Speaking exclusively to Car Dealer, he said that demand was even stronger than levels seen in June 2020 following showrooms reopening – adding that the valuations firm was unsure when this would end.
Although there was still one more day to finalise figures when Martin joined the Car Dealer Podcast, he explained that on Cap Live currently average values for three-year old cars were up two per cent.
This is equivalent on average to £250 extra on each car.
There have been some highlights though, including the BMW X3 diesel that rose in value by six per cent or £1,200 on average.
The Porsche Macan, Skoda Karoq and Vauxhall Mokka all rose five per cent, equivalent to £1,500, £635 and £350 up respectively.
He said: ‘The market is so strong. It’s stronger than we’ve ever known.
‘The word unprecedented has obviously been used a lot in the last few months or year but this is stronger than it was going into June last year.
‘We’re going to move values up this month by around two per cent on average. That’s the largest single movement up since 2009 so it is absolutely going great guns out there.’
The valuations expert added that in recent weeks they had been adding ‘almost 0.5 per cent a day’.
As the bright and sunny days are now here, Martin revealed convertibles have increased in value by around four per cent or £650 on average.
SUVs, however, have also stayed strong and are up two per cent on average.
Used petrol, diesel and plug-in hybrids were up two per cent, while hybrids were up around one per cent and EV values were down 0.7 per cent.
Earlier in the month it appeared that values would be strong but stable. However, Martin explained that as professional buyers have been stocking up it has kept demand high.
In fact, he added that some were looking to hold onto stock expecting that values will climb even more.
He said: ‘We’ve been hearing about some remarketers holding back even, waiting for that strength to come.
‘It’ll strengthen again next week I’d say or the week after.’
He added: ‘It’s obviously a lot of demand but also there are supply issues, and there are more supply issues to come.
‘Initially, it’s dealers replenishing their stock. From the retailers we’ve spoken to, there was one with 20 people queuing outside his door on April 12.’
Problems with new car supply are increasing used car demand, and issues with semiconductors resulting in factory shutdowns has only adding to this.
However, retail prices are only ‘going up gently’ he explained while used values are ‘going through the roof’.
Martin explained: ‘At the start of the month it was really, really stable. On average around 0.2 per cent up.
‘We got to April 12, the first couple of days it was steady again and we didn’t think it would go up too much as it seemed business was good but not absolutely booming.
‘Since we’ve been having calls with retailers and realised how strong it actually was.
‘Then you start to get the data through from auction sales and remarketers since the 12th, and actually it started a little bit earlier than that in the week commencing the 5th.
‘Values just absolutely went through the roof.’
You can hear the interview in full by listening to the Car Dealer Podcast, available on Apple Podcasts, Spotify and more.