Used prices up 6.7% in May to triple previous increase
Cap hpi has reported an overall price increase of 6.7% at the 3-year point during May, equivalent to over £800 per car.
This increase is more than three-times the previous monthly increase in values. The company attributes this rise to strong consumer demand and dwindling supplies.
“We really are in unprecedented times,” said Derren Martin, Head of Valuations at cap hpi. “From franchise dealers to car supermarkets and independents, activity levels across the board have been amazingly strong, with sales rates ahead of budget and in most cases ahead of pre-COVID rates.”
Every sector has seen values increase in May. For example, the Ford Fiesta is up 8.5%, (over £1,000 at the 1-year age point), Audi A3 up over 7% (£1,300 at 1-year old, £800 at 3-years), Vauxhall Zafira up 10.4% (c.£750 at 3-years), Mazda 6 up 8.1% (c.£700 at 3-years), BMW X3 up 6.2% at 3-years old (c.1,500) and Volkswagen Tiguan Petrol up 10% or £2,400 at the 1-year point.
Martin concluded that while demand will likely dip from the current peaks, supply levels are still going to be lower than normal.
“There is no tsunami of stock waiting to appear,” said Martin. “There are well documented new car supply issues, meaning less part-exchanges and fleet returns due to component shortages, particularly for semiconductors.
“Currently manufacturers and dealers are switching some customers into cars they have in stock, but what happens when those stocks dry up? Undoubtedly, many lease terms continue to be extended too. From late June/July, stock levels will have dwindled and the component shortage could well be impacting supply more acutely, depending on the brand. The semiconductor issue could well have an even greater sting in the tail.”