A “market correction” has wiped £500 to £1,000 off the price of the some used cars during May, according to data published by Cap HPI.
Derren Martin, head of UK valuations at the vehicle pricing data specialist, said that the pace of change in the used car sector had been accelerated this month as part of “a realignment of values after some unprecedented strength in the market”.
“The market is moving quickly, and I can’t think of a time in recent years where current data will have such an impact on profitability,” he said.
Cap HPI said in a statement issued today that it had seen values drop by up to 4% – depending on the sector and age – month-to-date.
The fall equates to an average of over £350 on a one-year-old car and over £300 on a three-year-old car, it said.
Martin said: “Some mainstream cars have had between £500 and 1000 knocked off their value this month.
“The reasons for this are a realignment of values after some unprecedented strength in the market, which resulted in increasing or stable values in 2017/18.
“Cars will naturally deflate in value, but this hit seems to be all happening over a short period.”
Martin said that Cap HPI is advising all our customers to keep a close eye on values in real-time with its Live product.
Cap HPI said that its data showed that the lower medium sector at one year is down nearly 3% during May or £400 while the super mini sector at three years is down over 3.5% in May or £275.