Used cars 'now gaining in value'

Barks · 12 Sep 2009 at 10:19

Second-hand cars are gaining rather than depreciating in value due to a shortage in supply, an industry-wide research company has found.
CAP Motor Research Ltd, which provides valuation data to the car industry, said the usual 15%-a-year depreciation of used car prices has been reversed.
Companies delaying replacing their fleets and the government scrappage scheme has led to a shortage in supply.
This year the average family car has increased in value by about £600.

Peugeot 107 Urban 07/07 plate, 20,000 miles: Jan value £4,575 - Sept value £4,850 = +£275
Ford Focus 1.6 Zetec 5dr: 06/06 plate, 30,000 miles: Jan £4,700 - Sept £5,625 = +£925
VW Passat 2.0 SE Tdi 4dr, 06/06 plate, 30,000 miles: Jan £7,550 - Sept £8,850 = +£1,300
Land Rover Discovery 2.7 V6 Tdi SE, 06/06 plate, 30,000 miles: Jan £16,600 - Sept £20,000 = +£3400

http://news.bbc.co.uk/1/hi/business/8251920.stm

I did actually explain the economics behind this to many of you a few months back but you all said I was talking rubbish despite a perfectly reasonable explanation. In fact some people went as far as taking the mick at such an absurd and ridiculous suggestion. Anyone with even common sense let alone sound economic understanding can appreciate that a shortage in demand of new cars (due to the recession) results in a shortage of supply of new cars, and eventually second hand cars thus possibly leading to a price increase in used cars as demand exceeds supply. So read the statistics for yourselves

Dr House · 12 Sep 2009 at 10:26

yep, my missing needs a new car again and the same cars are going to cost 4 to 5k more then they where a few months ago.

lordrobs · 12 Sep 2009 at 10:34

Its the same as house prices going up. The only ones who benefit are those who are looking to downsize / downgrade.

It is tempting to find out how much the Octavia is worth though, last time I looked I think it was around £27.44

atpbx · 12 Sep 2009 at 13:31

OCUK experts in failing at understanding basic economics shocker!

Shurely shum mishtake?

Housey · 12 Sep 2009 at 13:38

My car is now worth £40K but I would be willing to let it go for £30K to anyone from this forum, but be quick!

Fr0dders · 12 Sep 2009 at 14:18

trouble is, everybody on this forum knows why you want shut of it lol

Howard · 12 Sep 2009 at 14:19

Excellent, my Honda will be worth 10k in a few months then

jamoor · 12 Sep 2009 at 14:22

I just hope this trend doesn't continue too much, as I love the fact that we have cheap used cars.

monkey_boy · 12 Sep 2009 at 14:34

How long before Car Craft use this as a selling point? They could argue that it's actually cheaper to buy it than not to buy it.

Scania · 12 Sep 2009 at 14:41

Great! my e36 has probably gone up by £5

Biohazard · 12 Sep 2009 at 14:56

R420LA6X2/4MNA said:
Great! my e36 has probably gone up by £5

ditto!

although it does make sense, with the scrappage scheme removing thousands of servicable cars.

peterattheboro · 12 Sep 2009 at 15:11

My thirsty V6 will still be worth naff all

Kappa · 12 Sep 2009 at 15:49

scott212 said:
I did actually explain the economics behind this to many of you a few months back but you all said I was talking rubbish despite a perfectly reasonable explanation. In fact some people went as far as taking the mick at such an absurd and ridiculous suggestion. Anyone with even common sense let alone sound economic understanding can appreciate that a shortage in demand of new cars (due to the recession) results in a shortage of supply of new cars, and eventually second hand cars thus possibly leading to a price increase in used cars as demand exceeds supply. So read the statistics for yourselves

Quite a high horse you're sitting on there old chap. If I remember correctly NO ONE opposed the idea of lower supply = higher prices.

edit - awesome, my Passat will hopefully be worth something now!

IAmATeaf · 12 Sep 2009 at 17:09

I read something along similar lines a few weeks ago in some car fleet magazine. The gist of it was that most lease companies rather then selling their cars at a lower price last year are keeping cars for 5 years. This has created a shortage of cars hence the rise in the prices. Also dealers are now keeping the numbers of demonstrators at a minimum hence again a shortage of nearly new cars.

Barks · 12 Sep 2009 at 17:12

Kappa said:
Quite a high horse you're sitting on there old chap. If I remember correctly NO ONE opposed the idea of lower supply = higher prices.

edit - awesome, my Passat will hopefully be worth something now!

Well the whole argument stemmed from an article saying new cars were so heavily discounted they were becoming cheaper than their used equivalents and some people didn't even believe that despite the statistics and the parkers article.