Asking prices for used cars are 79% higher than they were pre-pandemic, but the rate at which prices are rising is slowing.
New figures from listings website DoneDeal show the annual rate of inflation slowed to 10.7% in the second quarter of this year.
That is down from 26.6% the same time last year, and is the lowest annual rate since the first quarter of 2020.
The report states that the average annual rate of price inflation before the pandemic was 2.7%.
Between April and June, quarterly price inflation slowed to 0.9%, down from a high of 8% in the third quarter of 2021.
Dr Tom Gillespie, Environmental Economist at University of Galway and author of the DoneDeal report said using ad view metrics as a measure of demand allows him to look behind the scenes at the price movements.
“After a 14% spike in demand in the first quarter of 2023, typical at the beginning of the
year, a 9.7% decrease in demand was observed in the second quarter of 2023,” he said.
“This was coupled with a 7.7% increase in the stock of used cars on DoneDeal and hence had a stabalising effect on prices,” he explained.
He said the rebounding of supply and a stabalising of prices is encouraging from an affordability perspective.
Today’s figures also show that the market for new cars in Ireland is growing.
It states that the cooling of supply chain issues in the motor production industry has led to reduced wait times for new models.
Figures from the Society for the Irish Motoring Industry (SIMI) show that 19,449 new cars were registered in the second quarter of this year, up over 27% on the same time last year.
Imports also increased slightly by 0.7% compared to the same period last year to a total of
12,553 in the second quarter of this year.
Meanwhile, the share of used cars being imported from the UK fell to a new low of 28.8%.
“This is in stark contrast to the first quarter of 2020, when the share of all imported used cars coming from the UK was 93.6%,” Mr Gillespie pointed out.
Overall, used car imports to Ireland were down over 52% in the first three months of 2023 when compared to the first three months of 2019.
Recent figures from SIMI show that the share of new EV registrations continues to grow. This is quickly translating into the used car market, according to today’s report.
Between January and March of this year there was a tripling of the number of used EVs listed on DoneDeal in comparison to the previous quarter.
There were around 1,500 EVs listed, compared to just over 500 in the second quarter of last year. That number increased again in the second quarter of this year to 1,700 listings.
Today’s figures show that prices for used EVs dropped by 4.7% in the second quarter of this year, the biggest price drop in any part of the Irish used car market since well before the pandemic.
“The transitional supply shock of new EVs to the used car market can go some way to explaining this price drop, but also, the grant for new EVs is due to be lowered in July, making a purchase of a new EV more attractive than a secondhand equivalent,” Mr Gillespie said.
“As EVs become more plentiful in the used car market they will become more affordable, encouraging
more people to switch to a cleaner method of transport,” he added.