The ‘banger’ market has ‘exploded’ with increased values and volumes, despite thousands of car buyers switching to new cars due to low cost PCP deals, vehicle data provider Glass’s has found.
Glass’s recorded that since the start of 2013 the number of cars over 10.5 years old being sold at auction has increased by around 50%.
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Rupert Pontin, head of valuations at Glass’s, said: "We believe this is because large numbers of buyers are selling their bangers and signing up to low-cost new and used car PCP deals to get behind the wheel of a newer model.
"However, instead of this flood of bangers entering the market leading to a collapse in values, they have actually increased quite substantially. The average auction price for a 10.5 year-plus car in January 2013 was £725 but in June of this year, it was £875. Enough new buyers are entering the market to soak up the extra volume and the banger market is actually in excellent health.
"Partially this is as a result of improving economic conditions – more people are feeling confident about buying and running a car at the entry level – but also the quality of older cars on sale is improving all the time. We see many bangers going through auction in excellent condition at very reasonable prices and, for many people, they make extremely sensible purchases.
"It is very much a case of ‘The banger is dead. Long live the banger!’"
Pontin said that there will be an oversupply of older vehicles in the future, which could decrease values.
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By GlobalData"The number of people switching into PCPs does not really show any sign of slowing down and this means that the volume of older vehicles on the market will continue to grow. At some point, this will lead to oversupply and falling values but it is quite difficult to predict exactly when," Pontin said.
