Used car prices start to simmer down post pandemic buyer frenzy

The secondhand car market is finally starting to cool off after prices went through the roof during the COVID-19 pandemic.

While some used vehicles – such as dual-cab utes – are still fetching a premium, high-end brands like Mercedes, Audi and BMW are heading south, towards pre-pandemic prices.

Wagga Motors used car manager Jarrod Lindsay says the pre-owned car market remains a “mixed bag” in terms of price, however there is more stock available on the lot than there was 18 months ago.

He said that during the COVID-19 lockdowns, secondhand car prices went “crazy” as people couldn’t travel, had time on their hands and had money to spend.

“People wanted to buy cars, but the new car market froze up because manufacturing stopped, imports stopped and then there was the semiconductor shortage,” Jarrod explained.

Many new vehicles are flowing back into the car yards, however Jarrod said there was still as much as a two-year wait for some products, such as Toyota hybrids.

Other manufacturers, such as Isuzu are expected to increase production by 30 per cent this year to keep up with demand.

With interest rate rises over the past six months there has been a slight drop in the number of used car sales and a softening of prices, however vehicles in tip-top condition and particular makes and models are still attracting a lot of interest.

“Good cars are not staying on the lot very long,” Jarrod said.

“We as a dealership stock a great range of popular makes and models.

“It’s very hard to find a new car for under around $30,000, so a secondhand vehicle that’s two or three years old and still under new car warranty is a good option for people with a lower budget.

“People that don’t want to wait weeks, months or years for their new vehicle can just walk in, pick a car off the lot, organise finance and drive away the same day.

“While there’s still that lag in the new car market, used cars are selling well.”

Jarrod says purchasing through a dealership, rather than a private seller, is still the preferred way to go for many used car buyers because they have the peace of mind that the car has been mechanically checked over, is free of financial encumbrance and in most cases still has the balance of a new car warranty.

He said the number of cars advertised on used car websites had increased over the past months, indicating many people were looking to sell their vehicles online.

“I look at the websites every day and the number of private used cars for sale within a 100-kilometre radius of Wagga has jumped from around 170 to 300,” Jarrod said.

“During the pandemic, we would often have multiple buyers for the same car on the day, so demand would be greater than availability.”

Dual-cab utes, including Ford Rangers, Isuzu D-Max and Hiluxes, still aren’t lasting long on the lot, while many people are also looking for mid-sized SUVs such as the Hyundai Tucson, Toyota Rav 4 and Honda CRV and HRV models.

Jarrod said demand for some vehicles, such as Toyota LandCruiser utes “went nuts”, with a two-year wait pushing prices up during the pandemic – and they’re still high.

“In the last two years we’ve seen people buying a new car and reselling shortly after for a profit. In my 23 years in the industry I have never seen this happen,” he added.

The team at Wagga Motors not only sells new and used cars, they also buy them.

Jarrod said selling a car to the dealership was easy and he has had great success following recent advertising, especially for those who have a loan or finance over the vehicle, which can make selling privately a hassle with banks, and is time-consuming.

“We buy the vehicle, pay off their loan and they get the rest of the money in their bank account the same day. It’s so easy,” he said.

If you’re thinking of selling your car, or looking to buy, pop in and see Jarrod and the local team at Wagga Motors for great advice and service.

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