2% Price Increase Expected This Month After 3.7% Price Rise in August | Hilton Car Supermarket
2% Price Increase Expected This Month After 3.7% Price Rise in August
Cap HPI’s car sales statistics show that used car prices took another jump in August with values increased by 3.7 per cent at the three-year mark – that’s equal to £477 per vehicle.
In fact, the values have been rising for the last six months. Over the previous five months, the prices escalated by 20.3 per cent overall. On average, a car's price has risen by a considerable one-fifth.
Interestingly, one vehicle went up by almost £11,000 in the last six months.
Cap HPI’s head of valuations, Derren Martin, termed August escalation "on steroid" and believed secondhand car prices are rising like crazy.
Martin gave an interview to Car Dealer Magazine, where he clarified everything regarding the increase in prices. He stated, “There was a little bit of a lull around the back end of July, and then the first couple of days of August it seemed really stable.”
“I thought we were going to be in for a slight movement up during the month, but not to any great degree. From then on, I kind of described it as the market was on steroids.”
“We spoke to the auctions and lots of the remarketers, and there was suddenly a bit of an uptick in activity, and dealers were out and looking for cars and buying cars. That shortage of supply has driven prices up even further. This is off the back of the last few months where values have gone up then as well.”
He added, “From May onwards, it's gone absolutely crazy.”
“We saw like a two per cent increase, then a 6.7 per cent rise, then 4.8 per cent, 3.1 per cent and now 3.7 per cent. We thought values would go up this month, but not by more than they did in July.”
Analysing it with 2019, we witnessed a five to seven per cent reduction in prices in those months.
Martin acknowledged that their company wasn’t anticipating an August price increase over July since various secondhand vehicles were already selling at higher prices than their new counterparts.
Astonishingly, the traditional models with combustion engines saw the highest rise in value.
The most significant increase in terms of percentage in the last half-year was seen in Toyota Auris Hybrid (2012-2019) at the 3-year/30K-mile point.
Generally, the prices of Japanese hybrid hatchbacks boosted by 47.7 per cent, whereas the average value variation was £4,628.
After this, we find the present-generation Mazda MX-5 (increase 45.8 per cent/£5,254), Mercedes C-Class Cabriolet 2016-18 (44.1 per cent/£7,875) and the Vauxhall Mokka (44 per cent/£3,663).
Martin indicated the Mokka was an ideal case of how bizarre the secondhand vehicle market is.
“The Mokka has been in plentiful supply in the past, and it actually looks good value because values were quite low before.” Cars like this and Astras and Zafiras, which are typically fleet and rental vehicles, have had the room to go up in value," He added.
Since the residents here couldn’t go abroad for holidays, Multi-Purpose Vehicles (MPVs) had witnessed the highest price escalation.
The Mercedes V-Class diesel (2014-2019) at the 3-year/30K-mile point went up by a shocking £10,954 in half a year or 43.9 per cent.
In September 2021, Martin expects the prices to increase compared to the last month's values slightly. He believes them to go up by around two per cent. He also thinks that the increased prices will not drop any time soon.
“There's not going to be loads of stock coming back in September because of the shortage of semiconductors with new cars and shortage of part-exchanges and fleet returns off the back of that. I think demand will continue to stay strong.”
Source: Car Dealer Magazine