The average price of a used car was £17,173 in July, a like-for-like increase of 19.5% increase on the same period last year.
According to Auto Trader, against the all-time high of 32.2%, recorded in April 2022, last month’s rate of growth appears relatively conservative. However, Auto Trader said that while some commentators have been predicting an imminent price crash for several months now, its data, reveals used car prices remain stable.
On a month-on-month (MoM) basis, average prices have increased (0.2%), which contrasts with typical seasonal trends (July 2019 recorded a -0.4% decline) and undermines any suggestion prices are about to drop.
The current softening in the rate of growth in part caused by growth now overlapping last year’s already very high levels – in July 21, prices were up at a then all-time high of 14.1% year-on-year (YoY).
According to Auto Trader, by applying a longer-term view, it’s clearer to see the full extent of the recent growth and just how strong prices remain; last month the average price of a used car was up over £3,300 when compared with July 2020, and £4,100 when compared with July 2019.
Richard Walker, Auto Trader’s Director of Data and Insights, said: “With price growth softening it would be easy to misinterpret the data as a market in reverse or in decline, particularly against the current backdrop of economic uncertainty. But our data, which is based on the largest and most accurate view of the automotive market, shows that is simply not the case. And while demand is easing against last year’s once in a lifetime levels, with almost four million new and used car transactions ‘lost’ since 2020, combined with packed new car order books – and very lengthy waiting times – demand for used cars remains. Coupled with ongoing supply challenges, anyone predicting a crash in used car prices any time soon, will be sorely disappointed.”
Sue Robinson Chief Executive of the NFDA, added: “The NFDA expect used car values to remain strong as the supply of good quality retailable used cars are still lower than normal. Current new car volumes are restricting the number of part-exchange vehicles reaching the market that would normal help supply dealer forecourts, and at the same time some consumers needing a car quickly are turning to the used market to source a car.”