The price of an average car in Ireland is now 16 per cent higher than its market value for the equivalent period in 2020, a new report says.
A car just is like a home, it has risen in value, but if sold, the new home will also have risen in value.
A combination of Brexit, microchip shortages, real-world testing of new cars (WLTP ), and supply-side availability have led to this rise in used vehicle values, according to an expert.
The report, issued by Cartell.ie and CarsIreland.ie, says instead of depreciating, most owners’ vehicles have increased (appreciated ) in price.
Jeff Aherne, innovation lead at Cartell.ie, says a “perfect storm” has taken place in the market, resulting in an “unprecedented” rise in used vehicle values.
“Since Cartell.ie was set up in 2006, and started monitoring the used vehicle market, we have not seen anything like this before,” he says.
“Lead-in times for delivery of new vehicles have extended, principally due to the microchip shortage, and, until supply ramps up again we don’t see this situation improving in the near-term.”
Taking a sample size of 5,000 vehicles, Cartell looked at the retail price of like-for-like vehicles a year apart, assuming average mileage. Some vehicles in the sample date as far back as 2003.
“The results show that, on average, the year-over-year increase stands at 15.87 per cent,” Mr Aherne says.
A 161 VW Passat 1.6l diesel was valued at €14,900 last year, but is now worth €17,200. An 11 Audi A4 2.0l diesel has increased from €6,400 last year to €7,700 in 2021. An 08 Opel Corsa 1.2l petrol was worth €1,650 in 2020, but is today valued at €2,050.
Mr Aherne adds: “Those who benefit most are the owners of used vehicles, which have seen a spike in values, who are looking, and can afford to wait, for a new vehicle.”
