Used car price rise beginning to taper

Used car prices may have reached a ceiling, with just 4.6% between the price of a new car and a car bought a year ago.

According to BuyaCar, the average price gap between new and used cars was 24.1% in 2019, but that has shrunk as a result of the pandemic and global electronic chip shortage.

In 2019 customers of BuyaCar were paying an average of £20,595 for a car registered in the same year. So far in 2021 that figure has risen by 8.2% to £22,290.

But for older cars the price rise is significantly higher. For example, cars registered last year are selling for £21,303 on average in 2021. But in 2019 prices paid for 2018 models were £16,585 on average.

This means that prices paid for cars around one-year-old have shot up by 28.4% in comparison with 2019.

It’s a similar story for older cars, with prices paid this year for those between two and three years old 18.4% higher than for a similar age vehicle in 2019.

Christofer Lloyd, editor, said: “We cannot know for certain whether there is room in the market for prices to continue rising but there are certainly signs that the upward trajectory is slowing. We can say with certainty that the gap is narrowing dramatically in today’s market values between a car registered this year and one that first appeared on the road in 2020.

“This is especially apparent when we compare the substantial price gap that existed between nearly new and older cars in 2019 with that of the current market.”