UK used car prices £4,000 higher than two years ago as second-hand values continue to climb

Used car prices have jumped in recent weeks, despite signs that supply shortages which have driven up values are easing. 

The latest data from online marketplace Auto Trader shows that prices of secondhand models jumped by an average of 1.5% between March and April, and rose 2.7% compared with 12 months ago, marking an acceleration in the rate of growth.

Despite fluctuations in asking prices, year-on-year growth has now increased for 37 consecutive months and April’s change represents a jump from March's 2% rise, itself up from 1.3% in February.  

The average price of a used car on Auto Trader is now £17,843 - £3,979 more than two years ago when prices suddenly started to rocket. At their peak, secondhand values were growing by 32% year-on-year and while this has slowed the overall trend is still upwards. 

Data from auction specialists BCA also show continued growth in the used car market, with its latest figures showing a 4.7% rise in sale values between February and March. However, in contrast, AA Cars says prices on its platform in the first three months of 2023 were virtually unchanged from a year ago. 

Auto Trader said the acceleration in price growth was down to continued challenges in used car supply, which it estimated to be down by 8.9% compared with April 2022, while demand was up 8.3% based on its analysis. 

High demand and short supply, fuelled by issues on the new car market, have been largely responsible for the rapidly ising price of used cars over the last two years but new figures from industry body the Society of Motor Manufacturers and Traders (SMMT) suggest it could be getting easier to find a secondhand model. 

Data from the SMMT shows that the used car sales grew by 4.1% in the first three months of 2023, after falling for the three previous quarters. SMMT chief executive Mike Hawes said that the easing of supply chain issues in the new market was “unlocking availability in the used market”.

While this is no guarantee that prices will drop, better availability could see used price growth soften in coming months. However, Auto Trader’s director of data and insight, Richard Walker, warned: “Based on what we’re tracking across the market, there’s no indication of it slowing significantly anytime soon.” 

BCA’s COO Stuart Pearson echoed this, noting: "Used volumes have risen this year and we are seeing an improving mix of inventory hitting the market. Demand for any vehicle in good condition remains intense and we continue to see exceptional values across most value sectors.”

The SMMT figures showed that used electric cars were the fastest growing segment in the first three months of the year, with sales up 56% but figures from Auto Trader and BCA suggest prices for EVs remain volatile.

According to Auto Trader’s April figures, average EV values were down 18.1% on the prior year due to a rapid rise in the number of cars on the secondhand market. BCA also said that EV prices continued to fluctuate but had levelled out by the end of March as demand increased to absorb some of the sharp increase in supply. Previous Auto Trader data showed that premium EVs were suffering most, with high-end models from Tesla, Jaguar and Audi losing the most in asking prices while cheaper mainstream options held their values better.