Used cars now cost 63.7% more than pre-Covid as demand drops

Asking prices for used cars rose 29% in the year to the end of June, the latest research from DoneDeal has found.

According to the car listings website, prices being sought for cars are now 63.7% higher than they were before the Covid-19 pandemic began.

Cheaper cars are now 96.9 per cent more expensive than they were pre-pandemic, while cars in the price range over €19,000 rose by 1.5 per cent in the second quarter of 2022.

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An analysis of demand related metrics on DoneDeal indicates that car demand is down 2.4 per cent year-on-year but still 12.4 per cent above pre-pandemic levels.

The rapidly rising costs are being driven by an ongoing supply demand imbalance.

This has led to an average 5.9% increase in asking prices for used cars every quarter over the two years that Covid-19 has been around.

Dr Tom Gillespie, who compiled the data, said that inflation in the wider economy along with increasing interest rates are having an effect on reducing demand.

"An analysis of demand related metrics on DoneDeal indicates that car demand is down 2.4% year on year but still 12.4% above pre pandemic levels," he said.

"On the supply side, although the deficit for new cars is still very acute when compared to pre-pandemic levels...year-on-year it is up slightly at 2.1% for the first 6 months," Dr Gillespie said.