Lack of stock continues to fuel used car values
The latest used car report from leading vehicle auction company, British Car Auctions (BCA) shows that year-on-year values were up by over 17% in March, although prices declined marginally - by 0.7% - when compared to February 2013.
For the fourth month running, average used car values remained at £7,000 or more as the market continued to be short of retail quality stock. Across the board used cars averaged £7,000 last month, down by £56 compared to February but significantly ahead of March 2012 by £1,026 (17.1%).
March 2013 recorded the fourth highest average monthly value since BCA's reporting began in 2005. However, post-Easter, BCA has seen buyer demand weaken with conversion rates falling in the first week of April, suggesting there will be some pressure on values in the weeks ahead.
"Although average values continue at near record levels, prices are high largely as a result of the constricted supply rather than strong demand," Simon Henstock, BCA's UK Operations Director commented.
"We also saw pressure on conversion rates in March, with a notable reluctance for trade buyers to bid as strongly on poorly presented vehicles. Values for cars requiring any significant degree of cosmetic work were hit the hardest.
"In contrast, values for well-presented retail quality vehicles continue at often exceptional levels, outperforming price guide expectations by a considerable margin.
"As we are now in the post-Easter period, the dynamics of the market are changing. Typically this time of year brings a softening in demand combined with an upswing in supply, so we expect to see continuing pressure on values and conversion rates in the weeks ahead."