[reevesy]

hi all....
got to have a moan as i'm hacked off trying to find a second hand car at the moment....
credit crunch...times are hard blah blah blah....thought finding what i want would be easy but it's turning into a right slog.
got 4 grand cash but what is really hacking me off is that practically every trader i've looked at is selling cars at up to a grand more than auto traders guide price...
the book price for traders apparantly allows for a dealer profit so are they just being a tadge greedy.....or allowing for a big drop after haggling?
.....i'm guessing the former rather than the latter.

incidently this morning i stumbled on a nice black 2003 1.8 tdci ford focus....average miles and close to book price (the only one i've found)
....rang up.....sold

dear say car dealers are struggling.......but from what i've seen it's hardly surprising.

[t72bogie]

they are struggling as theres a shortage of used cars, people are not buying and selling as much, so they need to make more margin on the ones they do

prices on some premium cars have gone up £5-10K since the crash last year and panic selling

no, finance is tight, more people out of work, and the last thing you normally buy when times are uncertain is a new car

...expect used car prices to rise steadily as this carries on

[FZR400RRSP]

There's a black 03 Focus 1.8tdci for £3995.00 at this mob.
Not high mileage either.
I'd expect dosh off that £3995.00 for cash too.

Newmarket Motor Company

54 plate one here too.

http://dealerservices.autotrader.co....0/carstock.htm

[reevesy]

Originally Posted by FZR400RRSP

There's a black 03 Focus 1.8tdci for £3995.00 at this mob.
Not high mileage either.
I'd expect dosh off that £3995.00 for cash too.

Newmarket Motor Company

yep thats the one that sold......gutted as i was ready to drive the hour or so with cash in hand.

[FZR400RRSP]

D & M Car Sales | Quality Used Cars in Huddersfield, West Yorkshire | View Our Stock

[reevesy]

Originally Posted by t72bogie

they are struggling as theres a shortage of used cars, people are not buying and selling as much, so they need to make more margin on the ones they do

prices on some premium cars have gone up £5-10K since the crash last year and panic selling

no, finance is tight, more people out of work, and the last thing you normally buy when times are uncertain is a new car

...expect used car prices to rise steadily as this carries on

this something i find bizarre.....i'm no alan sugar granted.....
but if cars are not selling......why would you but the prices up?

[reevesy]

Originally Posted by FZR400RRSP

D & M Car Sales | Quality Used Cars in Huddersfield, West Yorkshire | View Our Stock

.....bit of a trek for me as i'm in Norfolk....
i was up that way a week or so back at a course in Hull.

[qwerty321]

If you have trouble finding cars try looking at some slightly over your budget and try and haggle the seller down.

When I was looking to buy I also had around £4k, looked at cars upto £5k because I had a car to consider for trade in.

[reevesy]

Originally Posted by qwerty321

If you have trouble finding cars try looking at some slightly over your budget and try and haggle the seller down.

When I was looking to buy I also had around £4k, looked at cars upto £5k because I had a car to consider for trade in.

yep i've been doing that......
not sure what traders are likely to knock off for cash there and then.....500 quid?.......probably less i'm guessing....
it's been 7 years since i last bought one!

[lmccauley]

Originally Posted by reevesy

this something i find bizarre.....i'm no alan sugar granted.....
but if cars are not selling......why would you but the prices up?

It's supply and demand. People aren't buying as many new, so there aren't as many second hand appearing, so dealers end up paying more for them. They can then set their prices higher, as there are more people wanting to buy second hand, and less second hand cars to buy.

[FZR400RRSP]

Originally Posted by reevesy

.....bit of a trek for me as i'm in Norfolk....

I've driven Aberdeen to Ipswich and back in the same day for a car.
Just two weeks ago, Aberdeen to Birmingham and back for a car.
My attitude is that you can't just wait for the right car to turn up on your doorstep.

[FZR400RRSP]

Originally Posted by reevesy

this something i find bizarre.....i'm no alan sugar granted.....
but if cars are not selling......why would you but the prices up?

I don't think dealers are increasing their margins.
That would be silly.
But they are having to pay more for the stock.
So just keeping the same margins will result in higher forecourt prices.

[jassco]

As said elsewhere, my second hand car actually increased in value over 7 months despite adding 50% more miles onto the clock.

Because of the scrappage scheme, there are fewer second hand cars about, meaning they go up in value. Coupled with the fact that people in general can't afford new cars (unless you've scrapped your old one), prices are just going to keep increasing

[reevesy]

looks like things are not likely to be improving then

[FZR400RRSP]

Originally Posted by jassco

Coupled with the fact that people in general can't afford new cars

This is the bit I found odd.
My wife's car was a 3.5 year old Renault Clio.
I was given trade for it (£5500), logic says the dealer will put it up for sale around the £6300-£6500 mark.
Now, one can buy a new Clio for that.
Alright, it won't be the same spec.
It's a basic 1.2 petrol where my wife's was a good spec diesel, but still.
Why bother with a 3.5 year old one?
Not my problem, I just find it odd that it is perceived that people can't afford new cars, when new cars can cost as little as used ones...

[ste v p]

Originally Posted by FZR400RRSP

This is the bit I found odd.
My wife's car was a 3.5 year old Renault Clio.
I was given trade for it (£5500), logic says the dealer will put it up for sale around the £6300-£6500 mark.
Now, one can buy a new Clio for that.
Alright, it won't be the same spec.
It's a basic 1.2 petrol where my wife's was a good spec diesel, but still.
Why bother with a 3.5 year old one?
Not my problem, I just find it odd that it is perceived that people can't afford new cars, when new cars can cost as little as used ones...

Do you mean he gave £5,500 part ex? If so, you need to look at the cash to change on the car you bought.

Let's say a car was on the market for £20,000 but you haggled them down to £18,000 with £5,500 for your part exchange car. Cash to change is (£18,000-£5,500) £12,500. Alternatively you could have haggled down to £17,000 and the dealer only offers you £4,500 for your part ex. The cash to change is still the same ---> £12,500. So as long as the dealer is making his money on the car he's selling, the amount he "buys" your car with is irrelevent, he still gets a Clio and £12,500 cash. Thus if the car you bought cost the dealer £15,000 ,to make a gross profit, he must sell the clio for >£2,500.

Of course if you weren't buying another car, then it sounds like a good deal!

Back to the topic, I was buying recently and I had to get into the mindset that I could walk away from a car. I found a few cars I was happy with buying but it took a while before I found the right price level. I ended up using the book price as a guide not a bible. If the book says a car is worth £4,000 but someone comes along and pays £5,000 for it, then the book was wrong. A car is worth what someone is willing to pay for it. I'd be tempted to put in a low offer and wait. If the car sells for a higher price then you know you were too low. If it doesn't, the dealer may get back to you asking you to improve your offer. Who knows? I personally quite enjoyed the whole process!

[FZR400RRSP]

Originally Posted by ste1000

Do you mean he gave £5,500 part ex?

No, I just drove in and asked how much he'd give me for it.
£5500 straight off the bat, which was what I wanted.
When we (briefly) looked at a Mini a year ago, that dealer offered me £4500 for it as part-ex.
Needless to say, that's why we don't own a Mini now.

[Leej]

Originally Posted by FZR400RRSP

I don't think dealers are increasing their margins.
That would be silly.
But they are having to pay more for the stock.
So just keeping the same margins will result in higher forecourt prices.

I was talking to a guy at the local car sales and he was saying that the prices of some cars sold at auctions are shockingly high. He can't buy cars for cheaper at the auction now that what he would have sold them for not long ago.

[lmccauley]

Originally Posted by FZR400RRSP

This is the bit I found odd.
My wife's car was a 3.5 year old Renault Clio.
I was given trade for it (£5500), logic says the dealer will put it up for sale around the £6300-£6500 mark.
Now, one can buy a new Clio for that.
Alright, it won't be the same spec.
It's a basic 1.2 petrol where my wife's was a good spec diesel, but still.
Why bother with a 3.5 year old one?
Not my problem, I just find it odd that it is perceived that people can't afford new cars, when new cars can cost as little as used ones...

Well, you can't extrapolate from one case to the whole industry, but when I was looking at my last car, interest-free deals made buying a new car cheaper than a 2-year-old car. On the other hand, 8 months ago, I bought a 4 year old car for £30k less than new.

[ste v p]

Originally Posted by FZR400RRSP

No, I just drove in and asked how much he'd give me for it.
£5500 straight off the bat, which was what I wanted.

Nice!

Perhaps it is a sign of the market that people are buying more second hand cars because they can't afford new cars, therefore the price will rise. I have to say I'm always shocked at how much cars depreciate the first years after purchase, particularly as cars nowadays are in general pretty reliable. It's as if the manufacturers are shooting themselves in the foot - the cars are too reliable so people don't need to get new ones. Manufacturers must rely a lot on buyers' egos to want rather than need a new car.

[un1eash]

Originally Posted by ste1000

Nice!

Perhaps it is a sign of the market that people are buying more second hand cars because they can't afford new cars, therefore the price will rise. I have to say I'm always shocked at how much cars depreciate the first years after purchase, particularly as cars nowadays are in general pretty reliable. It's as if the manufacturers are shooting themselves in the foot - the cars are too reliable so people don't need to get new ones. Manufacturers must rely a lot on buyers' egos to want rather than need a new car.

Its more the other way around, modern cars are built to last 10-15 years tops. After that they just cost to much to repair when things go wrong, also the quality of mass produced cars can be terrible.

My 22 year old Mk1 MR2 is the most reliable car ive ever owned and will keep going for many more years. My 2 year old BMW Z4 though has already blown its exhaust and snapped a spring after 17k miles.

[Honeywell1945]

I'm looking at selling my daughters car , Webuyanycar valued it at £2940 3 weeks ago , yesterday it was £2565 , went to a dealer round the corner today was quoted £3250 , all cash to buy it .

I'm going to a few more tomorrow armed with £3250 as the baseline , be interesting to see what happens .

[gavan]

Originally Posted by reevesy

this something i find bizarre.....i'm no alan sugar granted.....
but if cars are not selling......why would you but the prices up?

The same reason that house prices are apparently going up in defiance of common sense - lack of supply.

Less supply and the same demand = higher prices.

In this case there's evidence to suggest that people are avoiding buying new and searching for a secondhand bargain instead, thus increasing demand for secondhand and ironically having the effect of putting prices up even more.

[jassco]

Originally Posted by FZR400RRSP

This is the bit I found odd.
My wife's car was a 3.5 year old Renault Clio.
I was given trade for it (£5500), logic says the dealer will put it up for sale around the £6300-£6500 mark.
Now, one can buy a new Clio for that.
Alright, it won't be the same spec.
It's a basic 1.2 petrol where my wife's was a good spec diesel, but still.
Why bother with a 3.5 year old one?
Not my problem, I just find it odd that it is perceived that people can't afford new cars, when new cars can cost as little as used ones...

sounds like you got a good deal, although I'm wondering where you can buy a new clio for £6,500? I can't find a basic version within £2000 of that, nevermind a good spec diesel which'll be around an extra £2000+.

[t72bogie]

lets not forget that any "book price" you can find on the internet n Autotrader or Parkers etc is NOT the REAL "book price" that the traders use

they have their own "book price" in a paid for (expensive) version of "Glasses Guide" that they renew a few times per year

this is the real "trade price" and you will see them refer to it a lot

...adds a lot of confusion to the mix when you turn up and say "My car is worth this, it told me so on Autotrader" (or whatever) and its £500 out

[VXB]

This is a very interesting subject and quite rightly all is being focussed on the supply of stock. There is a definite shortage of good quality stock, so dealers have been competing with each other for what stock there is, resulting in prices being "over book".

Several things are happening in reality. As used car valuations took a right thumping last year, many of the fleets (companies who lease car from the likes of lex for example) decided to hang on to their car rather than release them into the market and lose money on them. By the same token, as used car values are on the up, many of the fleets are seeing big benefits foir the stock that held on to...

Consequently, it is fact that 50% of all new vehcile sales go to the fleets, the remaining being private buyers. Therefore, the used car market is driven in a large part by the de-fleeting of lease cars. Their extending of their leases has meant that this has resulted is a significant shortage of used stock.

Regarding the scrappage scheme, what is being seen is that the majority of buyers usingthis scheme are using it to buy into well equipped new car and the big winners have been the likes of Hyundai and Kia. They are typically older buyers who have never bought a brand new car before and probably newver will again. As a result, new car sales in the mainstream sector like ford, vw, vauxhall, have taken a nosedive and many have put their new prices up, some by as much as 15-20% on volume models. Thus, the new car buyers are having to find more cash even if the vehicle they part-ex is yielding high returns - because new car prices are being hiked at rates faster than those of used car increases.

This has also played its part in the shortage of good quality stock - back to the point of dealer buying and selling "over book".

BTW - any consumer valuations from Parkers and Autotrader are supposed to be "adjusted" so that when the customer walks in, they feel like they get a good deal and that the marging of the dealer are protected. Personally, I think that they are all off the mark at the mo as valuations in the used car market are so difficult to predict right now.

Sorry for the long post!

[FZR400RRSP]

Originally Posted by VXB

As used car valuations took a right thumping last year, many of the fleets (companies who lease car from the likes of lex for example) decided to hang on to their car rather than release them into the market and lose money on them.

I don't quite understand what you mean by this.
If companies are leasing cars, the car's value after the end of the lease agreement is completely irrelevant to them.
You cannot "lose" money on leased cars.
What does appear to be happening is that companies are extending the lease of their existing cars.
So when the deal runs out at three years, they will ask the lease company for a rate to keep them another two years (for example).
This has a two-fold effect.

1/ Their monthly lease costs reduce (because they're leasing older cars)
2/ They don't have to pay the three months 'up front' like they would with a new fleet.

This practice definitely delays the release of used (ex-lease) stock onto the market, as you say, but not for the reasons you say (IMO).

[VXB]

I think that we are saying the same thing. Granted I wasn't clear...

Essentially the leasing company would not have wanted the vehcile back at the end of the lease period as it would have been, on paper, declared as a loss because of its used value. If you add up the total amounty of vehicles that they have, if most were declared as a paper loss, they might have become insolvent (this was a very real stuation for many leasing firms!). So they would have offered attactive terms for the lease to be extended, so that the "asset" was being written down somewhere.

The value of the car is important to the lessee at the end of three years for the reason that if they replaced the vehcile on a like for like basis, it would cost them substantially more to switch to a new car (because as I said, new car prices have hiked up so much), and as the predicted 3 year value is one of the primary drivers the monthly lease rates. So a switch would have cost much more, especially if they have a large fleet.

So you are correct in that the lessee is not so concerned about the valuation because they do not effectively own the asset. It is important when it comes to changing the vehcile...

[FZR400RRSP]

Again, I'm not sure I agree, VXB.
Anyone looking at replacing fleet cars (as I have to as part of my remit) is usually only interested in one figure, that being the monthly lease figure.
I haven't seen much/any indication of these figures increasing as a result of car price/values fluctuating at all.
In fact, if anything, there's never been a better time to lease, some of the deals going around are amazing.
If you take an Audi A4 as an example, one can lease one of those for around £330 a month (excl VAT).
That is less than I was to lease my Audi A4 in 2002.

[trademan]

Whenever I sell a car around " book" the response is a mixture of, whats wrong with it?, so how much is it for cash, my p/ex is worth more than that, that's too far to travel etc............... bearing in mind that to sell cheaply you must first have bought cheaper.......... however there are still a few sensible people left who want to buy cars at the right price. I prefer buying 'em to selling 'em. Some good views ( posts ) here.

www.wewwillbuyanycar.net