Secondhand car price crash?

[Superflow]

TheGreatDane said:

Not a price drop per se, but on all the M car groups I'm on there has definitely been an uptick in the number of cars being listed.

Used to be maybe 5-6 a week and recently its been nearer to 3 or so a day.

Cost of living taking effect as people sell assets to free up cash.

[Deep Thought]

TheGreatDane said:

Not a price drop per se, but on all the M car groups I'm on there has definitely been an uptick in the number of cars being listed.

Used to be maybe 5-6 a week and recently its been nearer to 3 or so a day.

I'm noticing that also here in NI. There wouldnt be that many around or come up listed but i'm seeing more coming up. People putting "not getting the use out of it hence selling". BUT, they're not moving. So they're going on the market - both privately and at dealers - and theres really not a lot of buying happening.

I definitely think the market has peaked. Feels like the moment in a trajectory path where it peaks and almost feels like its levelled off, then starts to drop.

I would not like to be paying full retail price for a car today and i do think private sellers are "optimistic" in their pricing.

[Deep Thought]

Superflow said:

TheGreatDane said:

Not a price drop per se, but on all the M car groups I'm on there has definitely been an uptick in the number of cars being listed.

Used to be maybe 5-6 a week and recently its been nearer to 3 or so a day.

Cost of living taking effect as people sell assets to free up cash.

I dont even necessarily think its to use the asset value, i think its the running costs per month too.

An M car is going to need super unleaded and could be early 20s at best in fuel economy. Likely highest rate tax too for many of them so £630 a year. Insurance costs, servicing, etc. Even as a weekend car on minimal miles you could be seeing £2.5K pa including fuel just to have it sitting there doing little driving.

And i do think many fear a drop so are trying to get out before that drop hits.

[Theoldguard]

TheGreatDane said:

Not a price drop per se, but on all the M car groups I'm on there has definitely been an uptick in the number of cars being listed.

Used to be maybe 5-6 a week and recently its been nearer to 3 or so a day.

Could be a number of reasons, but I guess alot of people who watch the market can see its turned and maybe see opportunities to sell now whilst prices are still relatively high and buy something newer / better in 12mths for the same, or less money.

Other maybe fear the depreciation and having to pay back big loans, then there are some who simply cannit really afford to keep running certain cars with fuel and other costs rising, and having returned back to the office. Lots of reasons but for sure when prices are falling its not as much fun holding onto an asset that maybe was only a play thing or a lockdown distraction.

[Superflow]

Deep Thought said:

Superflow said:

TheGreatDane said:

Not a price drop per se, but on all the M car groups I'm on there has definitely been an uptick in the number of cars being listed.

Used to be maybe 5-6 a week and recently its been nearer to 3 or so a day.

Cost of living taking effect as people sell assets to free up cash.

I dont even necessarily think its to use the asset value, i think its the running costs per month too.

An M car is going to need super unleaded and could be early 20s at best in fuel economy. Likely highest rate tax too for many of them so £630 a year. Insurance costs, servicing, etc. Even as a weekend car on minimal miles you could be seeing £2.5K pa including fuel just to have it sitting there doing little driving.

And i do think many fear a drop so are trying to get out before that drop hits.

Yes it’s all cost of living related fuel etc.

People are waiting to see what happens.If finance rates increase more and BOE gets close to 3% by year end then I’d expect some movement.

[TheGreatDane]

For those in the market for a car, it bodes well but annoyingly I've kicked said can down the road for months at a time as to when I'll buy as something has always happened to make me put my sensible hat on.

I had convinced myself that I'd buy by March/April this year, then the whole cost of living kicked off and made me think it's best to wait as they will drop in price.

Hate being sensible at times but I'd equally hate myself if I buy now and they drop considerably come Oct/Nov.

[Superflow]

The trick is not to care.

I’m not bothered either way if the market corrects I’ll buy something I like ,if it doesn’t then I won’t, but I certainly will not buy at current values.

[Theoldguard]

TheGreatDane said:

For those in the market for a car, it bodes well but annoyingly I've kicked said can down the road for months at a time as to when I'll buy as something has always happened to make me put my sensible hat on.

I had convinced myself that I'd buy by March/April this year, then the whole cost of living kicked off and made me think it's best to wait as they will drop in price.

Hate being sensible at times but I'd equally hate myself if I buy now and they drop considerably come Oct/Nov.

I don't think we will see considerable drops by Autumn, yes a few desperate sellers here and there maybe, but at the minute prices are falling by 1% per month on average, so it will vary by make, model, price etc.

If that starts to increase to 2% you will still need 6-10months of continuous month on month falls to get back to where we once were. But if things do get bad then there is always a possibility of higher monthly falls that mean we get back to where prices once were alot quicker, but for this to happen I do think that supply also needs to increase alot quicker.

So either way with the market having now turned the biggest risk is having to face normal depreciation as well as a market correction.

£20k motor you buy today say would normally cost £17k. You go to sell in 3 years it would normally have fallen from £17k to £12k. So you could be looking at £20k down to £12k if prices eventually fall back to their long term norms, and part ex at least for now are poor as are WBAC offerings.

People say that new prices are up so used prices will always remain higher than what they used to be, I don't buy this, the reason prices of new are up at the minute is due to higher input costs and lack of supply that means they do not need to offer discounts / incentives. When input costs fall, production improves new prices will either fall or incentives of financial contributions will return, maybe not next year but will once things in the supply chain are back to normal and inflation falls back.

[easy_rider33]

TheGreatDane said:

For those in the market for a car, it bodes well but annoyingly I've kicked said can down the road for months at a time as to when I'll buy as something has always happened to make me put my sensible hat on.

I had convinced myself that I'd buy by March/April this year, then the whole cost of living kicked off and made me think it's best to wait as they will drop in price.

Hate being sensible at times but I'd equally hate myself if I buy now and they drop considerably come Oct/Nov.

I'm in the same position, I said this earlier in the tread.

The 911 numbers on Autotrader for sale historically have been circa 1800, during covid this was constrained to circa1400, now i'm seeing the number today up at 1659 so lots more for sale. This of course is all models and not specific ones but the trend seems to show increased numbers available and the flattening of the price curve with cars hanging about longer before selling or not selling for the speculative price and being realised a bit more realistically. some of the older C2 996 models are a bit optimistic IMHO

[David____]

I'm really struggling with the situation too. I'm helping out a friend of mine to sell her Toyota Aygo (she upgraded to a Yaris in April). We pitched it at the lower end of the market, but after 6 weeks of advertising, only 3 expressions of interest and only 1 viewing. We're going to go cheaper shortly...at which point it will pretty much be the cheapest in the country! As suggested on this thread, I think everyone is aware that the "asking for" prices are still high, given the type/age/condition of car, and so aren't willing to buy. This goes double when there is an expectation of significant price reductions "just round the corner", associated with market correction, cost of living increases, cost of petrol/diesel and supposed increases in new car production.

I myself am in the market for an A45 AMG, selling my Civic Type R, yet I'm fearful of doing it. I don't have any problem with having the funds to make the change. No problem at all. The price difference is around £15k. But if petrol prices don't recover and with the cost of living sky rocketting and perhaps a recession round the corner, the idea of owning an ICE car that could drop in value from £35k to £15k during a 3 year ownership period means a catastrophic loss of money. Perhaps like quite a few on PH, I consider myself to be someone who appreciates the finer points of driving for shere pleasure and I'm just not ready to go EV yet. So, where am I left? Dithering....not sure what to do. Perhaps keep the Type R another year and see what the market does?

My question is, are there ways around this issue (other than giving up on life and buying an EV)? If new car production was at pre-covid capacity, presumably one option might instead be avoid buying a 2nd hand car outright (what I've done my entire life), but instead, lease a new car, pay the monthlies for a few years and then hand it back, without having to worry about depreciation.

[Pistonheader101]

[quote=David]I'm really struggling with the situation too. I'm helping out a friend of mine to sell her Toyota Aygo (she upgraded to a Yaris in April). We pitched it at the lower end of the market, but after 6 weeks of advertising, only 3 expressions of interest and only 1 viewing. We're going to go cheaper shortly...at which point it will pretty much be the cheapest in the country! As suggested on this thread, I think everyone is aware that the "asking for" prices are still high, given the type/age/condition of car, and so aren't willing to buy. This goes double when there is an expectation of significant price reductions "just round the corner", associated with market correction, cost of living increases, cost of petrol/diesel and supposed increases in new car production.

I myself am in the market for an A45 AMG, selling my Civic Type R, yet I'm fearful of doing it. I don't have any problem with having the funds to make the change. No problem at all. The price difference is around £15k. But if petrol prices don't recover and with the cost of living sky rocketting and perhaps a recession round the corner, the idea of owning an ICE car that could drop in value from £35k to £15k during a 3 year ownership period means a catastrophic loss of money. Perhaps like quite a few on PH, I consider myself to be someone who appreciates the finer points of driving for shere pleasure and I'm just not ready to go EV yet. So, where am I left? Dithering....not sure what to do. Perhaps keep the Type R another year and see what the market does?

My question is, are there ways around this issue (other than giving up on life and buying an EV)? If new car production was at pre-covid capacity, presumably one option might instead be avoid buying a 2nd hand car outright (what I've done my entire life), but instead, lease a new car, pay the monthlies for a few years and then hand it back, without having to worry about depreciation.
[/quote]

Looking at new A45 deals, can see 36 months @ £837 a month with £2,517 initial deposit. 10k miles PA. That comes to almost £33k.

[David____]

Pistonheader101 said:

Looking at new A45 deals, can see 36 months @ £837 a month with £2,517 initial deposit. 10k miles PA. That comes to almost £33k.

That's bananas! So essentially that's Mercedes saying they think a new A45S will halve in value over 3 years (they're about 60k new)? Doesn't seem like much of an option.....

[Fusion777]

Pistonheader101 said:

Looking at new A45 deals, can see 36 months @ £837 a month with £2,517 initial deposit. 10k miles PA. That comes to almost £33k.

Bonkers. Then again, so is the list price.

[Hugo Stiglitz]

Right now I'd hunker down.

This winter is going to see the true start of the recession.

[sam.rog]

Hopefully 1997-1998 subaru impreza sti come back down to £6-7k and not the £12-15 thats being asked. I might be able to get one the.

[ChocolateFrog]

You'd have to be mad to buy now if can wait until the winter.

I think it's a dead cert that prices will be lower in 6 months time.

Feel free to quote that one.

[Pistonheader101]

[quote=David]

Pistonheader101 said:

Looking at new A45 deals, can see 36 months @ £837 a month with £2,517 initial deposit. 10k miles PA. That comes to almost £33k.

That's bananas! So essentially that's Mercedes saying they think a new A45S will halve in value over 3 years (they're about 60k new)? Doesn't seem like much of an option.....

Spend £20k on an M140i and enjoy.

won't lose more than a few k.

[Theoldguard]

Take it from me there are alot of people out there who cannot wait for their PCP, PCH, bank loan to end and who have no intention of refinancing. Being stuck with a gas guzzler or high monthlies when your energy bill has just increased by £200 per month is the reality many now face and with prices falling will struggle to even get a price that covers the outstanding finance. I think vehicle ownership is going to fall in the coming few years as it becomes more expensive and it will go the complete opposite where dealers have too many cars and not enough buyers.

[ChrisH72]

Regardless of what's going on the value of ICE cars was always destined to be hit hard by the rise of EV's. As soon as EV ownership becomes viable for the masses and the cost of them is equal to ICE then the latter will become practically worthless. The only ICE cars to hold any value will be extremely special ones.

It'd be a brave person who pays these extortionate prices for relatively common cars at the moment. I think the best bet for petrol heads who must keep changing cars is to spend this time enjoying cheaper, older cars which will soon be obsolete. You can have just as much fun in an RS250 Megane as you can in an A45 Merc for a fraction of the cost, and there's less to lose.

[brickwall]

Theoldguard said:

Take it from me there are alot of people out there who cannot wait for their PCP, PCH, bank loan to end and who have no intention of refinancing. Being stuck with a gas guzzler or high monthlies when your energy bill has just increased by £200 per month is the reality many now face and with prices falling will struggle to even get a price that covers the outstanding finance. I think vehicle ownership is going to fall in the coming few years as it becomes more expensive and it will go the complete opposite where dealers have too many cars and not enough buyers.

Will those people just hand back the car and go without?

Sure, there are some households who can cut 2 cars to 1 or for whom the car is purely a convenience, but for most car owners it’s a necessity. When the PCP ends they’ll still need a car - won’t they just trade down to keep the monthlies affordable?