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When will 2nd hand car prices return to normal?

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  • When will 2nd hand car prices return to normal?

    Will the ECB interest rate increase be the trigger for 2nd hand car prices to start finally dropping and returning to normal?

    I've been totally confused by the car market for the last couple of years. I get the supply of new cars having an impact on the nearly new 2nd hand market, petrol prices increasing demand for electric/hybrids, the 25 year rule in the US causing specific models to go crazy, and the collector/investor market going a bit mental... but lots of cars don't fall into those categories and had price hikes that don't make sense to me.

    I'll give a specific example. I've wanted to buy a GT86 or BRZ since they came out in 2012. For some reason I set a budget in my head that when they dropped to €15k, I'd buy one. So I waited. In 2019, they were dipping below €18k so expected to see them hitting €15k in 2020. Covid did its thing, and now most of them are €20-25k even for early models, even though they are around 10 years old. For what they are, they are expensive to tax (€750), expensive to insure, and with petrol prices higher than ever, they don't make much sense as a daily driver. I get that they are a "driver's car" but surely the price will start to normalise soon?

    The other thing I've noticed is that I have a large number of cars saved in Donedeal and the majority of them have been for sale for many months. It seems to be hard to find buyers for some models, yet the prices are inflated, static and never drop.

    I guess this is more of a vent than anything.

  • #2
    ive nothing to add really only i agree 100% with the rant, and am hoping for the same thing .

    what id love to know is who is actually paying 30k for an AE86 or an EVO 5 ? Who are these nutcases?
    looking back now, I think that maybe, every now and again, I should have braked a little earlier

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    • #3
      Well if they don't then the cheapest car you can ever buy is one that doesn't depreciate

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      • #4
        Originally posted by Mark2 View Post
        Who are these nutcases?
        Proudly sponsored by the Credit Union and egged on by Jon44 crowd.

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        • #5
          Are there any stats to say how many cars change hands every month? Beepbeep give new registartions but can't see secondhand on it.

          That would be an interesting stat to see month on month to see if the market has stalled or not. I don't think the media is helping things either as there was some stat being cited on the radio (probably from donedal) that used car prices were up 60+% on this time last year. Those kind of headlines won't help with a correction.

          https://www.rte.ie/news/business/202...andemic-level/
          _________________
          Older but no wiser.

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          • #6
            I think Brexit is probably the biggest issue, whatever number of car x that exists in the country today isn't really going to increase anymore, so there is nothing driving prices down like there was before. If you brought something in from the UK, you could sell it cheaper because you paid less for it in the first place, and this would have an effect on the market for that car.

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            • #7
              Originally posted by Mark2 View Post
              ive nothing to add really only i agree 100% with the rant, and am hoping for the same thing .

              what id love to know is who is actually paying 30k for an AE86 or an EVO 5 ? Who are these nutcases?
              Raffle companies are to blame some what but I've heard of people working/ living in OZ wiring cash for a cam and then sticking it into a shed. Obviously someone looks over the car for them but people are seeing them as "money in the bank".

              It can go both ways in my view, people start offloading stuff and prices drop or they sit tight knowing there's nothing else out there to trade up to.

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              • #8
                With the shortage of new cars and the lack of secondhand cars or the cost to import from UK or the like I do not know when it will go down or will it ever go back to what it was. Add the increase to VRT rates on non ev cars which too will drive up the cost of new and imported cars.

                I remember reading something that the average age of cars here is increasing, to ten years old or something like that so demand may go up too. Obviously if the recession comes, increase in interest rates, etc. might have a negative affect on the cost of cars, but might just mean people hold on to cars longer rather than replacing them. What used to be an "uneconomical" repair for the average Joe might become a case of fix it and suck up those costs keeping older cars on the road for longer where before they would be scrapped and replaced with a secondhand from the UK.

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                • #9
                  if fuel prices remain high the price will inevitably fall out of the highs octane stuff

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                  • #10
                    Brexit. Ah yes, forgot to mention that.
                    Back to the GT86 for a minute - if a 2016/2017 BMW i3 is worth around 20k, very much a relevant car for the mental petrol prices, why is a 2012 GT86 worth about the same? The i3 would have cost a lot more when new also.

                    You can say supply and demand, but most the ones I'm watching on Donedeal have been for sale for months, so demand doesn't seem to be there (at the current prices).

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                    • #11
                      Originally posted by dabofoppo View Post
                      so demand doesn't seem to be there (at the current prices).
                      Until you go look to buy the model you want. ie GT86.

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                      • #12
                        Combination of Covid restrictions and payments meaning people weren't out spending and lots of people who were only working 1 day/week getting an extra €350 meant lads had a bit more coin in their pockets.

                        Huge jump in VRT on higher performance stuff the last couple of years.

                        That VRT increase also means new cars have jumped massively in price.
                        (Have you seen the bloody price of a new Golf R 🤮)
                        And because of the lack of availability of these, pushes used cars up further in price.

                        Bar a few exceptions, most new performance cars are dull as dishwater to drive, so older, more analogue stuff becomes more sought after, again increasing value.

                        Brexit obviously meant far less cars are available on the market, so the cars here again go up in value.

                        CAN'T IMPORT THESE ANYMORE LAD, SHE'S ONLY GOING ONE WAY.

                        Other stuff like the US market going wild for imports too.

                        Etc etc


                        I think prices here given our unique situation re VRT will remain pretty strong for a good while.

                        (Not as mental as it was, but still pretty strong)
                        Last edited by DonalM; 22-07-2022, 03:28 PM.

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                        • #13
                          Originally posted by Mark2 View Post
                          ive nothing to add really only i agree 100% with the rant, and am hoping for the same thing .

                          what id love to know is who is actually paying 30k for an AE86 or an EVO 5 ? Who are these nutcases?
                          Having sold a lot of stuff along the lines of those lately, there are 2 distinct groups of "nutcases" buying them. There are young people who grew up wanting them who never seen them at bargain prices and understand this is the price they have to pay now. I tell some people I gave €9000 for my first Twincam and they literally cannot believe it was that cheap, whereas back then there was older lads telling me I was mad and they bought them for 1500 punts. Times change.

                          There are also a lot of older lads who had them 20 years ago and now have a few pound spare for a toy. Most of these haven't stayed into cars as such but now have house built, family settled etc. and are looking for maybe a mid life crisis!

                          Growing demand coupled with disappearing supply and inflation means that the interesting car prices are here to stay. Maybe they will level out a bit but the issues affecting mundane ordinary cars such as production issues won't really change whats going on with the classic or performance world.

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                          • #14
                            I find myself agreeing with Glenn with one caveat: I don't see the prices collapsing significantly due to a few other elements:

                            1. they're not making any more of this light, cheap, manual, N/A stuff anywhere and where they are, it ain't cheap. A new 911 is €175k, turbo'd, only came as a self shifter at launch, weighs 1550kg before options because of PDK and despite a load of alu used and is massive.

                            2. public transport and hybrid. As public transport improves and less commuting is the norm, a more focused car is possible.

                            3. see also 1: this is it. Sunset of ICE. It's now or never.

                            4. Brexit, as explained.

                            5. Globalisation. Cars are increasingly traded globally.

                            6. as pointed out, new cars are now demented money and this puts pressure on the used market also.

                            Counterpoints to 1, 3 and 4:

                            A - public transport and hybrid might mean people to decide not to own a car. The market could shrink.

                            B - 80s/90s cars are living longer than say 50s/60s cars did at the time vintage taxation systems were introduced. Some countries have reflected this - Germany has the H (historic) plate which only grants vintage status to a largely original car in good condition. The Netherlands kicked out their vintage status from 30 to 40 years as more people both started to hold on to older cars and also started to acquire to speculate in them. A 30 to 40 year move in Ireland would impact values.

                            C - on the above point, green legislation. Stuff like E10, congestion charges, emission zones etc don't yet exist in Ireland but could affect older cars. Look at the ULEZ zones in London for example where people have literally been forced to sell up or pay a mega charge every time they want to drive their older car. There may have to be absolutely drastic steps taken by central governments to tackle climate change and the private car will be right up there in terms of stuff to change or ban or restrict or whatever.

                            D - as SJ pointed out, it is technically possible for Ireland to negotiate an exception with the EU on VAT and Customs for UK imports (assuming I have phrased this right). This would be a great political point to score if used car prices continued to rise or stay stubbornly high.
                            Last edited by Flet; 22-07-2022, 04:22 PM.
                            1998 Porsche 911 3.4 Carrera 2 (996)
                            2000 Mazda MX-5 1.8 Jasper Conran #68/400
                            2003 BMW 325i E46 Sport Touring


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                            • #15
                              Originally posted by mk2glenn View Post

                              Having sold a lot of stuff along the lines of those lately, there are 2 distinct groups of "nutcases" buying them. There are young people who grew up wanting them who never seen them at bargain prices and understand this is the price they have to pay now. I tell some people I gave €9000 for my first Twincam and they literally cannot believe it was that cheap, whereas back then there was older lads telling me I was mad and they bought them for 1500 punts. Times change.

                              There are also a lot of older lads who had them 20 years ago and now have a few pound spare for a toy. Most of these haven't stayed into cars as such but now have house built, family settled etc. and are looking for maybe a mid life crisis!

                              Growing demand coupled with disappearing supply and inflation means that the interesting car prices are here to stay. Maybe they will level out a bit but the issues affecting mundane ordinary cars such as production issues won't really change whats going on with the classic or performance world.
                              Yeah completely agree. This combined with negative interest rates (subject to change in near future). No capital gains tax or other tax for selling a privately owned vehicle makes for a very attractive investment for those that are so inclined.

                              We are also the only rhd country in the EU single market now. If that changes there might be change but their market has also inflated massively, if anything at a higher percentage than ireland. So grass is not always greener.
                              Last edited by davemx-5; 22-07-2022, 04:19 PM.

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