Inflated prices for second-hand vehicles have been highlighted in new data, as manufacturers continue to struggle to meet production demands of new cars.
The average price of a used car advertised last week was 23.9 per cent higher compared to the same week a year ago rising to £19,018 – the highest figure Auto Trader says it has ever recorded.
And it says 17 per cent of ‘nearly new’ second-hand models – those up to 12 months old – are now being advertised for above what they cost brand new.
Second-hand car values continue to surge: Auto Trader says the average advertised price for a used vehicle last week was over £19,000
The report comes after This is Money and cap hpi revealed last week the and which particular used models have risen most in value in the last six months.
The recent boom in used vehicle values is a result of unprecedented demand due to extended waiting times for new cars to be delivered.
A shortage of semiconductor chips needed for the latest models means manufacturers simply can’t make them quickly enough, with some – including Jaguar Land Rover – quoting 12-month waiting periods for particular models.
Auto Trader says the shortage of new cars has been the predominant factor that has sparked 76 consecutive weeks of average used car price growth.
It says ‘consumer demand’ for second-hand motors – based on searches and advert views on its website – is up 19 per cent compared to a year ago.
The marketplace added: ‘This growth is reflected in the more than 14.8 million cross platform visits to Auto Trader, which marks a massive 32 per cent increase on the same week two years ago.
‘There was also a 20 per cent rise in the hours (2.2 million) consumers spent researching their next car on its marketplace.’
Auto Trader said that despite a recent fall in inflation increases it doesn’t expect to see used car price growth slowing anytime soon
The report says the very strong consumer demand in the market is also highlighted by the faster speed at which retailers are selling cars.
Last week, it took an average of just 23 days for stock to leave forecourts, which is 17 per cent faster than the speed of sale recorded during April.
Auto Trader says this means retailers are not having to lower their prices nearly as much as they usually do in order to shift vehicles.
Of the 2,218 retailers who made daily price adjustments last week (202 fewer than in the same period in 2019), the average was a reduction of just £96 – in the same week of 2019, retailers were trimming prices by an average of £304 (68 per cent more).
Almost one in five year-old cars advertised above new price
Such is the massive acceleration in used car prices, almost one in five of ‘nearly new’ examples listed on Auto Trader are currently being offered for prices more expensive than their brand-new equivalents.
These are cars that are up to a year old and would have normally experienced sizeable depreciation – as is the case for most vehicles in the first 12 months.
Such is demand that 17 per cent are being advertised above what they would cost brand new.
That is a huge jump on the previous all-time high of 11 per cent recorded by the online patform in August, and over four times as many than in January (4 per cent).
Remarkably, 37 per cent of nearly new cars are currently priced within 5 per cent of their brand-new counterparts, up from 28 per cent in August and 13 per cent at the start of the year, says Auto Trader.
Last week, This is Money exclusively revealed the year-old used cars that are being sold for more than they are priced new.Data provided by cap hpi
The 25 cars listed here all have average year-old used sale values higher than their new list price.This ranges from 3.7% to 19.4% over the manufacturer’s brand new price. Source: cap hpi data accurate up to end of September 2021
Cap hpi, which tracks used car sale prices and provides vehicle valuation information to drivers, explained which models in September sold for more than what they cost new.
Topping the chart was the previous-generation Dacia Sandero, which was replaced with a new version earlier this year.The average price paid for one new – where stocks remain – is £9,773 while the average sale value of used examples with 10,000 miles on the clock is £11,673 – a premium of 19.4 per cent.
It’s also a similar case with the all-new Sandero.Cap hpi says used values for a six-month old version is £12,908, while a new example ordered will – on average – cost just £11,843.
It means buyers are currently willing to pay around the same for a year-old previous-gen Sandero as they are the latest example, simply because of long waiting times.
This is also the norm for year-old Duster SUVs, which are around £1,000 more expensive used – and with 10,000 miles already clocked up – than its new price commands.
Other examples of year-old mainstream models being more expensive than a new one include diesel Range Rover Evoques as well as oil-burning Land Rover Defenders and Discovery Sports, which is likely linked to the 12-month delivery waiting periods quoted recently.
Porsche’s Macan SUV, Mini Coopers (and hot hatch Cooper S version) as well as Volvo XC40 compact crossover and the Ford Kuga are also examples of mainstream models selling second-hand for above a showroom new price.
Richard Walker, Auto Trader’s data insights director, said: ‘With so much attention focussed on inflation right now, there’s huge interest amongst economists on those components that are recording substantial price rises, not least used cars which have been a notable driver of recent UK inflation rates.
‘With levels of used car price growth once again smashing previous records, there is a lot of speculation around how long this boom could last.
‘Whilst inflation in itself does pose a potential risk to consumer demand, we don’t expect to see price growth slow anytime soon.
‘This is based on the continued acceleration we’re tracking across the market – fuelled, in part, by increased levels of household savings, a positive sentiment shift towards car ownership, and the 1.5 million ‘lost’ transactions last year – coupled with the ongoing shortage in both new and used car supply.’
REVEALED: The second-hand cars that have risen in value most in the last 6 months
Last week, This is Money and cap hpi listed the models that are currently seeing the biggest rise in value in the last six months – March to September.
The data is based on three-year-old vehicles with an average of 30,000 miles on the clock.
All cars listed have seen values increase by around 48 per cent and more, with some priced around 60 per cent higher than they were in March 2021.
The data is collated from various sources, unlike Auto Trader, and does take into account dale prices rather than advertised ‘list’ prices.
20.Vauxhall Astra (2015-2020)
Avg value Mar 21: £7,011
Avg value Sep 21: £10,364
Avg £ increase: £3,354
Avg % increase: 47.8%
A three-year-old version of the previous-generation Astra has, on average, increased in value by more than £3,300 in the last six months, says cap hpi
Vauxhall’s popular family hatchback creeps into the list of big movers over the last six months.
Used values for the previous-generation car have risen by almost 48 per cent, which means the average value of a three-year-old example with 30,000 miles on the clock is more than £3,300 higher than it was in March.
19.Skoda Yeti (2009-2017)
Avg value Mar 21: £10,691
Avg value Sep 21: £15,786
Avg £ increase: £5,095
Avg % increase: 47.9%
The Yeti was discontinued by Skoda in 2017 to make way for the likes of the Kodiaq, Kamiq and Karoq, which are more traditional SUV models.However, Yeti residuals have always been strong