The latest on used car prices

The used car market has entered H2 with strong momentum behind it, boosted by improving consumer confidence and favourable market conditions which are not only helping cars to sell quickly, but also increasing sales, and stabilising retail prices.

According to our latest data, the average price of a used car in June was £16,410, which on a month-on-month (MoM) and like-for-like basis, is a softening of just -0.5%, in line with seasonal trends.

Since the start of the year, the used car market has recorded very robust levels of consumer demand, and at the halfway point shows no signs of slowing. In June, the level of demand on our marketplace rose 12.4% year-on-year, marking the highest rate of demand growth in 15 months. 

The underlying demand in the used car market is further highlighted by the 80.8 million cross-platform visits to our site last month, which is a 10% increase on June 2023, and a significant 21% rise on 2022. What’s more, our data shows that used cars are currently selling in just 29 days, three days faster than the same period last year, and five days faster than pre-pandemic 2019 (34 days).

Crucially, this demand is translating into more than just interest from car buyers, with the platform’s retail sales data indicating used car transactions rose circa 8% on June 2023, rising from an already very robust 6% YoY uplift in May.

Market boosted by confident economic outlook

The retail market benefits from rising consumer confidence levels, driven by optimism about the economy. Indeed, with the latest inflation figures falling to its lowest level in almost three years, the GFK Consumer Confidence Index improved for the third consecutive month in June. Our own consumer research found that 50% of in-market car buyers were more confident in their ability to afford a new car than they were last year. 89% were at least as confident as they were 12 months ago.

The growing levels of consumer demand in the market is combined with a recent drop in supply. In fact, whilst supply of used cars entering the market began to improve towards the end of last year, over the last quarter available stock has slowed, and in June fell -4.2% year-on-year, the largest drop since May 23. Due to the impact of COVID, supply levels of cars aged below five years old are facing the biggest squeeze, with those aged 1-3-years and 3-5-years recording a drop of -20.6% YoY and -16.7% respectively. Conversely, with production now back to normal levels, supply of ‘nearly new’ cars (those aged below 12-months old) are up 42% YoY.  

It's this imbalance in core market fundamentals - rising demand vs falling supply - which is helping to create a very robust used car market. Our Market Health metric, which assesses potential market profitability, rose to 15% in June; up from the 11% recorded in May, and the highest rate of growth since April 2023. For stock aged 3-5-years-old, it’s up a whopping 43% YoY, highlighting the considerable nuance in the used car market.