After an unprecedented increase in residual values this year, used car prices are now falling according to UK-based online retailer Autoquake.com.
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Rises earlier this year were caused by factors such as big fleets hanging on to cars for longer in the recession and the UK government’s scrappage scheme removing cars from the UK’s car parc.
Autoquake also says that the values of used cars are dropping faster online than on the forecourt.
“After months of rising prices, we’re seeing signs that the used car bubble has burst,” said Fredrik Skantze, Autoquake.com’s co-founder.
“Values at auction have begun to slide, and our prices are lower than they were a month ago.”
Autoquake says that a car which would have retailed for GBP10,000 on Autoquake.com a month ago is now typically listed at GBP9,312, a drop of GBP688.
The retailer also claims that the price gap between its prices and conventional car dealers is widening.
“As an online retailer, we can react more quickly and follow the movement of the market to ensure consumers get the best value car,” said Skantze. “A traditional bricks-and-mortar dealer has money tied up in stock and can’t just change the windscreen sticker prices of its cars overnight. At Autoquake.com, we can.”
Used car values look set to fall further between now and the end of the year. Glass’s, the leading trade price guide, expects prices to drop by between two and four per cent by the start of 2010.
