Automotive News : Used Car Prices Continue To Increase
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By: Thomas Pretty
Date Submitted: 2009-06-09 13:43:54 - Article Views: 50
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The Government scrappage scheme was introduced to kick start the car sales industries after months of falling sales figures and while the scheme has so far been heralded a success after generating more than 40,000 sales during its first month, yet that has had a considerable knock on effect on the used car sales market, with some models actually appreciating in value rather than depreciating.
Many used car dealers are having to buy in vehicles at a much higher price than last year and many are actually paying over the odds for certain models as they expect their valuations to rise over the next six month period mainly due to the fact that so few new cars were produced in early 2009 leaving a shortage on the market.
For example a used BMW Z8 will be able to fetch well above its book price given its considerable rarity, with only around 5,700 units built and sold between 2000 and 2003 worldwide. Some used BMW dealerships have been snapping Z8's up for up to 70,000 pounds as they know that the price will continue to increase because of the current market conditions.
In fact, many other used BMW models are appreciating due to the shortage of used cars on the market, of course not every prospective car buyer can afford a brand new vehicle, and many who can choose not to buy brand new as they do not want to take the immediate hit on the price of a brand new car in terms of depreciation as they lose value as soon as they speed out of the showroom.
So used cars are in demand, yet the supply is as low as it has been for years, therefore used car prices are increasing, especially the more high end cars, such as a used BMW. Many used BMW prices for a three year old used BMW are more than they were two years ago - and rising.
As more people take up on the scrappage scheme and other dealership deals on brand new cars, fewer used cars will be sold back on to the used car market, thus pushing up prices of used cars even further. For how long this will last, nobody knows but prices are set to continue to rise until next year. It has never been a better time to sell your car, but also may spell trouble for many used car salesmen. |
Author Resource Required for Reprint:
Thomas Pretty is an economist with many years of experience in drafting forecasts for the car sales industry. Find out more about used BMW at http://www.cooperbmw.co.uk/
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