Used Car Prices Skyrocketed By 26.3% In Past 12 Months

Used cars have seen extreme price inflation, with the Ford Focus seeing a 50% rise.

Some like to invest in gold, others index funds but last year showed that used car prices saw some serious and unexpected gains!

According to data from CarGurus, the UK’s top 20 most in-demand used cars saw an average price appreciation of a whopping 26.3%, with a few models seeing a much higher increase in average price. The data is taken from the 24th of January 2021 to the same day this year, allowing us to compare current prices to what they were 12 months prior.

One example of a particular car seeing extreme used car price hikes is the Ford Focus. Roughly this time last year, the Ford Focus was selling for 50% less than it is now, so in theory, if you bought one for £8,000 last year and didn’t touch it, you could sell it for £12,000 this year. The Ford Focus saw the most extreme difference in average sale prices.

The second most significant example of incredible increases in used car prices was with the Ford Fiesta, seeing an average increase of 36.7%. After the two Fords claiming first and second place, the Mini Cooper was in third place (34.9%) followed by the VW Polo (33.6%) and Mercedes-Benz C-Class (32.5%).

There are many suggestions that the pandemic was the main driving factor in used cars reaching historic prices. With the population being in lockdown and those lucky enough to continue to work from home, disposable income was no longer being spent on meals out, days out and events and this surplus in spare cash could have correlated to an increase in demand for used cars, thus driving up their prices as per the laws of economics.

Another pandemic-related factor is that new cars are actually hard to get nowadays thanks to the current chip shortage caused by covid.

Kevin Roberts, Director of Industry Insights & Analytics at CarGurus, commented on the matter:

“The semi-conductor shortage has contributed to the worst year for UK new car production since 1956 which, in turn, has led to an increase in demand for used vehicles. The resulting decline in available stock has therefore naturally driven up prices.”

Roberts also commented on car prices potentially decreasing back down to a less inflated level:

“The outlook for 2022 will remain dependent on vehicle production; if it can come back to a pre-COVID level we’ll likely see a stronger recovery in sales and a potential reduction in pricing, otherwise we’re looking at a further continuation of 2021 trends.”

Let us know if you’ve benefited from the skyrocketing prices, or found it even harder to find a reasonably priced used car, in the comments.

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Stats courtesy of CarGurus