If you’re looking to change your car soon, the state of the market might affect your plans. With experts predicting used car prices to soar, you might feel under pressure to secure a price you’ve seen recently.
However, it’s important to bear in mind that there are several factors working in unison to determine the price of used cars. In this article, we’ll cover the facts on what actually decides the price of a used car – and how you can secure the best deal.
Which factors influence used car prices in the UK?
When you’re searching for a used car, your first impression might be that the price is determined only by the vehicle age, make, and model. However, knowing how to find a good deal on used cars could be helpful, since identical models could be priced very differently.
There are a few reasons for this, but the main factors include:
- Supply and demand dynamics: These influence vehicle price as private sellers and dealers try to regulate the market and ensure a fair price for their stock.
- Vehicle age: Newer models can be more reliable and more technologically advanced than their recent predecessors. Even a couple of years can make a difference.
- Mileage: Prospective buyers see a high mileage as a sign that a car might not drive as well or last quite as long as one that’s been preserved.
- Condition: Any obvious sign of damage, including bumps and scratches, immediately devalues a car. Used cars are priced higher with satisfactory visual and functional condition of the bodywork, wheels, and interior.
- Model popularity: Some cars are simply more popular than others, so might sell for a higher price. This is especially true if the vehicle model is rare or part of a limited edition.
How does the economy impact the price of used cars?
Economic factors influence the used car market too. Since inflation determines the overall value of goods in the market at a given time, rising inflation impacts car prices too. And with everything in Britian becoming more expensive, the market is increasingly competitive.
Despite high prices, serious buyers are still likely to buy their desired model. Consumer behaviour determines pricing too: if multiple buyers start looking for a similar model at once, dealers will recognise the increased interest and put prices up.
Our tip: Don’t always follow the trends, as this means you might get ripped off. Spend time deciding which model is best suited to your family life and driving style and make your own shortlist.
Could the same car be cheaper in a different area?
Regional price variations in used car prices can be stark. Due to market demand and population size, the regional differences might be significant enough to mean that travelling to collect your new car might result in a better deal than buying one locally.
Demographic factors influence prices the most, but area accessibility should also be considered. If you’re thinking of buying or selling a car and you live in a remote area, it’s certainly worth doing some research to find out whether you could get a better deal by starting the process elsewhere.
Conclusion
Whether you’re buying or selling a car, it’s important to be aware of just how volatile the market is. Cars should only be traded after research on both sides, especially if you’re dealing with a model that’s rare or in high demand.
