Used automobile values remained £4,100 forward of pre-pandemic ranges in July

Used automobile values continued to develop on a year-on-year foundation in July, though the speed of development is softening.

Information from Auto Dealer’s Retail Value Index reveals the typical worth of a used automobile was £17,173 in July, which on a like-for-like foundation, is a 19.5% improve on the identical interval final 12 months.

The speed of development is slower than the 32.2% recorded in April 2022, feeding the narrative amongst some commentators that an imminent worth crash is coming, however Auto Dealer stated on a month-on-month (MoM) foundation, common costs have elevated (0.2%), which contrasts with typical seasonal developments (July 2019 recorded a -0.4% decline). The sentiment is backed by Cap HPI’s director of valuations Derren Martin.

Richard Walker, Auto Dealer’s director of information and insights, stated: “With worth development softening it could be straightforward to misread the information as a market in reverse or in decline, significantly in opposition to the present backdrop of financial uncertainty. However our knowledge, which relies on the biggest and most correct view of the automotive market, reveals that’s merely not the case. And while demand is easing in opposition to final 12 months’s as soon as in a lifetime ranges, with virtually 4 million new and used automobile transactions ‘misplaced’ since 2020, mixed with packed new automobile order books – and really prolonged ready occasions – demand for used automobiles stays. Coupled with ongoing provide challenges, anybody predicting a crash in used automobile costs any time quickly, shall be sorely disillusioned.”

The present softening within the price of development can, partly, be attributed to the truth that development is now overlapping final 12 months’s already very excessive ranges – in July 21, costs have been up at a then all-time excessive of 14.1% year-on-year (YoY).

Auto Dealer stated by making use of a longer-term view, it’s clearer to see the total extent of the current development and simply how sturdy costs stay; final month the typical worth of a used automobile was up over £3,300 when put next with July 2020, and up £4,100 when put next with July 2019.

Additional contributing components, outlined by the digital market, embody a slight YoY softening in client demand.  Nonetheless, it stated this have to be taken in context of final 12 months’s “distinctive” ranges, which was fuelled by large pent-up demand submit lock-down, and the massive surge in competitors for used automobiles as a consequence of new automobile shortages.

When evaluating the present market with pre-pandemic ranges, the most recent onsite knowledge from Auto Dealer reveals the quantity of advert views on its market have been up 12.4%.

Regardless of financial uncertainty across the rising price of dwelling, surging gasoline costs, and the Financial institution of England’s anticipated hike in rates of interest to curb rocketing inflation, Auto Dealer analysis suggests at the least 80% of customers are at the least as assured as they have been final 12 months of their means to afford their subsequent automobile – 43% stated they have been extra assured, which is up on the 41% recorded in June, and the 38% in Could. Three quarters acknowledged they have been intending to purchase a automobile inside the subsequent six months, which is in line with the degrees during the last 12 months, while two in 5 (40%) are planning on making a purchase order within the subsequent two weeks.   

Sue Robinson chief government of the NFDA, added: “The NFDA anticipate used automobile values to stay sturdy as the provision of excellent high quality retailable used automobiles are nonetheless decrease than regular.  Present new automobile volumes are proscribing the variety of part-exchange automobiles reaching the market that may regular assist provide supplier forecourts, and on the similar time some customers needing a automobile shortly are turning to the used market to supply a automobile.”

Information from eBay Motors reveals the typical worth of a used automobile supplied on the market through its on-line automotive marketplaces declined to £16,652 final month, with independents making the largest reductions – down 1.2% to £14,064.

Franchised sellers lower their costs by 0.8% to £20,201 and automobile supermarkets 0.7% to £16,688.

Costs remained 15% up year-on-year, nonetheless, and fears of a stoop in client confidence ensuing from the cost-of-living disaster have been mitigated by knowledge which confirmed that days to promote improved from 39.5 to 37.9 days month-on-month.

Prime 10 worth development – July 2022 vs July 2021 like-for-like:

Prime 10 worth contraction – July 2022 vs July 2021 like-for-like: