How Come Second-Hand Prices are Falling for Cars?
Second hand. It’s one of the best ways to save money on your car purchase. After all, new vehicles depreciate horrifically fast. However, while used cars fall in price quickly, their value still fluctuates significantly. After all, the availability of second hand and the demand for such vehicles significantly influences the current asking prices. In accordance, today, we’re considering why recent prices for used cars seem to be falling. This should help inform your own car buying or selling choices, too.
Don’t Buy on Price Alone
Car prices are dropping. That’s great news for most buyers. However, this does put people at risk of buying a car based on price alone. Unfortunately, this is incredibly risky. After all, while prices are dropping, this isn’t always just due to trends. In some cases, the reason could be simple: the seller is fraudulent.
So, if a car seems cheap, don’t just take the seller’s word for it. Make sure to run a vehicle check using the number plate to reveal a detailed history report. This can help you make a more informed decision.
Why are Second-Hand Car Prices Falling?
Many people have started to notice that recent second hand prices are dropping. How come, though? Well, there are a couple of significant reasons for the falling value of used cars.
Time of year is one of the most critical factors. Indeed, this time of year – just before the rollout of new models for Q1 2025 – is often when people sell up. Many owners of new vehicles will move their current car around now so they’re ready to jump on newly released models at the turn of the year. This can flood the market with used cars, dropping their value significantly. This also makes sellers more eager to sell. Thus, they might be willing to take lower offers around the new year period.
It’s not just availability to consider, though. Indeed, another factor influencing the current used market is the rapid advancement in technologies. After all, new cars come with increasingly innovative features and improved fuel efficiency. Thus, this cuts the demand for and value of less technologically equipped models, contributing a great deal to falling prices. EV vs petrol/diesel is particularly prominent in this regard.
In addition, the economic environment plays a significant role. Indeed, given the current spending environment and worries with cost of living, it’s perhaps unsurprising that many people have opted to go for lower-priced second hand cars rather than buying new. This means that not only are more people selling up old cars and switching to cheaper models, thus leaving more options available, but it’s also providing an incentive for people to sell who may not have done so normally.
A further point of note here is that the surge in prices seen between 2021 and 2023 is finally starting to stabilize. This was largely driven by a shortage of new models, but with supply chains having now recovered largely, this has left more scope for second-hand buyers again.
