Used car values up 13.5% in last three months, reports Cap HPI
Used car trade values have continued their “unparalleled” shift upwards, rising an extraordinary 13.5% over the last three months.
New data from Cap HPI’s daily Live service shows trade values rose 4.8% at the three-year point during the month of June, increasing by more than £625. This rise follows the 2% increase during April and 6.7% increase in May, signifying that on average, values have increased by a staggering £1,700 or 13.5% in the last three months. And over the same period, one-year-old cars are up £2,500 or 11%.
Derren Martin, head of valuations at Cap HPI, commented: “Consumer demand has remained very strong in June, despite half-term, great weather, and Euro 2020 to distract people. With stock-turn high, this has led to retailers requiring a constant supply of cars to replenish their forecourts. Well-documented new car supply issues, resulting from several component shortages, have led to fewer fleet returns and part exchanges. This has caused demand to outweigh supply for the third month running.”
However, as reported by Cap last month, the rise in the trade arena has not been seen to the same extent in the retail sector, making it difficult for the trade to replace cars from auctions or direct remarketers at similar prices.
Martin added that supply is still going to be lower than normal for some time yet, even if demand dips from its current levels.
“With new cars being in such short supply and likely to continue to be so for at least the next quarter, there is no bow wave of fleet returns coming through. One million less cars have been registered than would reasonably have been forecast over the last 18 months. These cars are lost to the used car market. It will be a while before supply outweighs demand again.”