New Auto Trader Index points to falling used car prices

A new quarterly index published by Auto Trader will track changes in advertised used car prices. The first Auto Trader Index results suggest that second-hand car values in the UK are softening as the economy remains weak and customers switch to smaller, more fuel-efficient models.

The average asking price for a used car, £9,206, was 1.3 per cent lower in the second quarter of 2011 than it had been in the corresponding period in 2010. The fall was especially pronounced for some larger cars, with prices for the Citroen C6 and Peugeot 607 falling by 26 per cent in real terms. Sports cars also suffered, with older examples of the MX5, for example, being advertised for 18.5 per cent less in real terms than previously. And there were regional differences too – advertised prices in London fell by far more than the national average, from £10,247 to £9,644, a drop in real terms of 10.4 per cent. Other indicators point to a slow market as well – cars are now being advertised for seven days longer than they were last year as cautious customers hesitate before buying.

It's not all doom and gloom, though. Values held up for a few luxury brands like Lexus and Jaguar, and average asking prices actually rose slightly across the board in the East of England, Yorkshire and Scotland.