Used car market strengthens in September, finds Cap HPI

Latest analysis from Cap HPI shows a strong used market in September, after a buoyant summer.

In the first 10 days of the month, values barely moved on average, with a negligible 0.1% drop at three years and 30,000 miles.

Electric vehicle values have remained stable and show a slight average uptick of 0.2% at the three-year age point; however, they are down, albeit negligibly, by 0.1% on average at one-year-old.

Commenting on the data, Derren Martin, director of valuations at Cap HPI, said: “Wholesale demand is healthy in the market currently. Retailers remain upbeat and are replenishing stock, and conversion rates at auction are improving. Importantly, there is not an over-supply situation.

“Demand continues to improve for EVs, and it’s becoming increasingly clear that the retail buyer is there for cars at the right price. Volumes continue to rise, as do the range of models available, which gives buyers a much greater choice than a year ago.”

September has historically been a strong month for used car values, often preceding an influx of higher volumes in the market. Since 2012, values in September have increased six times and remained steady once, with only minor drops in previous years.

In 2023, the decline reached -1.9%, the highest compared to a past maximum drop of -0.7% in 2014 and 2015.

Martin concluded: “Volumes will rise with fleet and rental returns generated by the new plate, but significant price downturns are unlikely, with values expected to remain steady for now.

“Unlike 2023's sharp year-end drop, this year’s market is expected to remain far more stable due to steadier interest rates, easing cost-of-living pressures, and lower overall defleet volumes.

“However, new car market dynamics, including potential ICE car reductions and BEV discounting, may impact late-plate values. Responsible remarketing will be essential in maintaining market stability.”