Will used car prices drop?
Discussion
The thought of spending £30k, then seeing a 20% 'correction' fills me with fear.
Or are they here to stay? Will all those now paying more for their cars be willing to sell them for less than they thought in the future? When the chip shortages go, will the manufactures be offering great discounts on new to start shifting some volume? Will they use it as a natural pause to create new ranges of eV or similar cars?
Or are they here to stay? Will all those now paying more for their cars be willing to sell them for less than they thought in the future? When the chip shortages go, will the manufactures be offering great discounts on new to start shifting some volume? Will they use it as a natural pause to create new ranges of eV or similar cars?
Unless hundreds of thousands of new cars suddenly become available the market won't suddenly drop, it will hit a peak at some point (maybe it already has) and then as the chips to build new cars start to arrive at the factories and new cars are built and arrive at dealers the market will return to depreciation. Most new cars being manufactured at the moment are missing some key electronic toys, heated steering wheel and large screen nav on Mercedes for example, nearly new full spec cars should hold up well over the next few years.
Supply and demand.
Supply and demand.
- I am not an economist or in the trade so don't sue me if it suddenly goes the other way.........
Over a three-year timeframe the chip shortage will be resolved, so new cars will become readily available again.
Currently the used market is being pushed up by the long waiting lists for new ones, once that's no longer the case, it's not obvious what would continue to support the current high used prices.
I'm not predicting an abrupt crash, but I would expect things to gradually return to normal in most cases, over the next couple of years 2022-23. The exceptions would be cars that are seen as 'special'; in particular those that are approaching the inflection point to stop depreciating anyway could stay up.
Trying to 'time' a market is shown to fail, over time and a good sample size. That is in the financial markets but I'd suggest cars are not much different. They are still an asset which is effected y multiple economic factors.
Supply/demand still reign.
It makes no difference if you buy high and sell low so long as you go back in low. Your still buying into the asset you came out of but at what appears to be a discount.
However, in the meantime you've had utility by means of use of the car and enjoyment.
If you sit on cash now you'll still have the same problem when you decide to buy....."is it the right time?".
Buy the car you want and enjoy it.
Supply/demand still reign.
It makes no difference if you buy high and sell low so long as you go back in low. Your still buying into the asset you came out of but at what appears to be a discount.
However, in the meantime you've had utility by means of use of the car and enjoyment.
If you sit on cash now you'll still have the same problem when you decide to buy....."is it the right time?".
Buy the car you want and enjoy it.
I personally think like house prices everything will hit the reset button soon
I lease a skoda karoq sportline and wbar offered me 25k back in sept it then went up to 29k last week so i did another quote today and its back to 25k still overpriced in my opinion considering the insurance valuation is under 22k
I'm considering a 6 or 12 month extension with leaseplan for a 5 or 10 % reduction in monthly payments or send it back and buy a banger until things settle down
I lease a skoda karoq sportline and wbar offered me 25k back in sept it then went up to 29k last week so i did another quote today and its back to 25k still overpriced in my opinion considering the insurance valuation is under 22k
I'm considering a 6 or 12 month extension with leaseplan for a 5 or 10 % reduction in monthly payments or send it back and buy a banger until things settle down
I have been thinking about changing my car for the last year, I know what I paid 4 years ago for my current car and the price to replace with the same manufacturer and equivalent model but 4 years newer is eye watering. Luckily I have a new MOT on my current car plus I have had it serviced so should hopefully see me good for another year.
I am seriously thinking about buying new for the first time in my life as the used car market is insane.
I am seriously thinking about buying new for the first time in my life as the used car market is insane.
Geffg said:
Think the prices have already started dropping. The valuation on mine has dropped £1k in the last month after rising the last 6months or so.
Agreed. I had thought of selling mine, and holding out till next year for a replacement, but it too has dropped about £1k in a month. ‘Approved Used’ prices are still about 4-5k more than that though!Edited by Geffg on Saturday 30th October 19:13
FastEdd11e said:
Trying to 'time' a market is shown to fail, over time and a good sample size. That is in the financial markets but I'd suggest cars are not much different. They are still an asset which is effected y multiple economic factors.
My next (new) car will be March 2023… let’s see if I can be the first person EVER to “time the market” 
Chuffedmonkey said:
I have been thinking about changing my car for the last year, I know what I paid 4 years ago for my current car and the price to replace with the same manufacturer and equivalent model but 4 years newer is eye watering. Luckily I have a new MOT on my current car plus I have had it serviced so should hopefully see me good for another year.
I am seriously thinking about buying new for the first time in my life as the used car market is insane.
This, this and more this. Only I've had mine 5, but fresh MOT this month and it has been very reliable over the 60k I've put on it. Never bought new before either but used prices are just daft and I don't think it's going to change anytime soon.I am seriously thinking about buying new for the first time in my life as the used car market is insane.
I can't see used prices dropping all the time new cars can't be supplied within less than 6 months of placing an order.
Because that means P/Ex cars aren't coming onto the market which keeps used prices high.
But once chips become readily available for new cars I'm sure things will change!
Because that means P/Ex cars aren't coming onto the market which keeps used prices high.
But once chips become readily available for new cars I'm sure things will change!
I thought about buying a POS until things settle down, but instead bought new from stock. Hopefully it will keep a bit of value, but I doubt it. In 18 months we'll see depreciation, plenty of availability as manufacturer's turn the taps on and less buyers having spent their covid cash.
Though if you listen too sometraders people on here, you need an astra diesel in your pension fund.
Though if you listen too some
I’m my experience they already are (WBAC and now Cazoo are following).
In my opinion they will drop further.
Yes there is a chip/pandemic-disruption driven supply and demand issue which has caused prices to increase, but I believe the following things will mean current increases are temporary:
- new entrants to the market, namely Chinese brands, coupled with changes in buying habits (towards electric / an “appliance mindset”) will drive down prices. Existing manufacturers will have to compete or die.
- Economy. Higher interest rates will change peoples’ affordability and priorities. Further economic impacts may also influence buyer behaviour.
- People will (/are) re-evaluate what they need from a car. Do they drive as much as they used to? For they need 2 (3/4…) cars? If cars become less important the motivation to change frequently and pay to do it will decrease. By the same token perhaps fewer chip-dependent toys will become the new norm but I doubt it!
Add to that the chip shortage will be resolved sometime.
The only reason I can see used prices not dropping is inflation, but I still believe they will drop in real terms.
In my opinion they will drop further.
Yes there is a chip/pandemic-disruption driven supply and demand issue which has caused prices to increase, but I believe the following things will mean current increases are temporary:
- new entrants to the market, namely Chinese brands, coupled with changes in buying habits (towards electric / an “appliance mindset”) will drive down prices. Existing manufacturers will have to compete or die.
- Economy. Higher interest rates will change peoples’ affordability and priorities. Further economic impacts may also influence buyer behaviour.
- People will (/are) re-evaluate what they need from a car. Do they drive as much as they used to? For they need 2 (3/4…) cars? If cars become less important the motivation to change frequently and pay to do it will decrease. By the same token perhaps fewer chip-dependent toys will become the new norm but I doubt it!
Add to that the chip shortage will be resolved sometime.
The only reason I can see used prices not dropping is inflation, but I still believe they will drop in real terms.
Gassing Station | Car Buying | Top of Page | What's New | My Stuff