The UK car market is seeing two very noticeable changes, one is the short supply of new vehicles and an increase in demand for used cars, which is causing the most popular used cars to have prices increased by up to 57% since 2019.
AA cars website has reported that one noticeable make and model which has risen dramatically in price is the Ford Fiesta, around three to five years old. Two years ago it was valued at £7,448 and now it’s being sold at around £9,770, today. It’s official, “nearly new” used cars are in high demand, as stated by key figures in the industry.
These price increases have mainly been attributed to the global shortages of vital materials such as copper, aluminium, and more importantly, computer chips used to power the onboard systems and computers which now practically go into every new car. The sudden shortage of availability has pushed buyers to the used-car marketplace, as opposed to being stuck on a never-ending waiting list. The knock-on effect has meant the demand for some make and models between 2019 to 2021 has seen a dramatic increase in prices, especially compared to pre-pandemic days.
Some more examples of price increases, a three-year-old Mini Hatch in 2021 is 57% higher in price than the same age and model built in 2019. The Audi A3 has seen the biggest price increase since 2019, a whopping 46.09%. The Ford Focus models have seen price increases by 43.11%.
Easing of lockdown restrictions
A well-known national motoring group said the first easing the pandemic lockdown last summer in 2020 had been the main cause of the increased demand for newer cars, in other words, it’s human nature to treat oneself after months of pandemic lockdown. A leading figure in the car industry said “some popular cars were growing in value, even as they sit on the driveway”.
In general, it’s very rare for purchased items to go up in value, this is normally reserved for houses and classic cars.
Still try shopping around
Even though there’s been a noticeable price increase in the used car market, if you shop around, there are still bargains to be had. As well as a shortage of new cars, many used car dealerships are experiencing a shortage of stock due to a lack of trade-ins. This has been highlighted by leading industry figures.
This current climate has seen the rise of online car dealers with huge advertising budgets, which are beginning to change the way car buyers shop. The days of wandering around several showrooms or forecourts looking at a few cars are slowly diminishing.
The bad news in all this is, on top of the increase in used cars, the shortages of new cars, the UK is now suffering from energy, fuel, and transport costs price rises which are all contributing towards the UK’s higher inflation rate. So in response to this, the Bank of England may have to act soon by increasing interest rates.
Look for the right used car deal for you
Best Price Car Sales hasn’t changed our business model to take advantage of the current price increases or shrunk away from offering industry-leading deals. Even before the pandemic came into effect in 2019, Best Price Car Sales who are based in Southampton were still offering no deposit, instant car finance, with free nationwide delivery to your home or place of business. We were offering over-the-phone part-exchange promises to customers for trade-ins on the old cars and collecting them for free too. We were even offering to pay the first two installment payments if you had decided to purchase your quality used car through one of our respected lenders. As of 2021, this has not changed and by contacting one of our friendly advisors, you can still enquire about our current deals and offers.
To learn more about what Best Price Car Sales can do for you, call us now on 02382 549 222 or click here to get instant car finance approval today.