With the taps turned back on for new vehicles, the second-hand market is being flooded with options that will drive used-car prices down this year.
Second-hand car prices are likely to tumble this year as Australia grapples with an oversupply of used models.
Last year saw active used vehicle listings increase 63.4 per cent – or an additional 1,276,256 adverts – over the 2023 figure, new data has revealed.
Data released by the Australia Automotive Dealer Association (AADA) show that 3,289,721 used-car listings were posted last year, with only 2,324,805 sold for a 70.7 per cent sell-through rate.
This is significantly down over the 2023 numbers, which saw 2,074,535 sales out of a total 2,013,465 listings, or a 103 per cent run rate between the January to December period.
The used-car oversupply is attributed to freer flowing stock of new cars after the increased wait times and short stock brought about by the COVID-19 global pandemic and then semi-conductor shortage.
While prices are expected to fall drastically in 2025 in the second-hand market, it remains to be seen if they will revert to pre-COVID levels.
In December, active listings were almost evenly split between dealers (49.3%) and private sellers (50.7%), while sales – which slowed by 8.1 per cent compared to November – showed customers preferring the latter over the former (56% compared to 44%).
In total, there were 322,532 used-car lists for sale last month and 181,7244 sales, equating to a 56.3 per cent sell-through rate.
The average days to sell a used car in December increased to 48.7 – the second-highest monthly average of the year – which was up from 47 in November but still below the 49-days figure in October that was the highest of 2024.
For the final month of 2024, the Ford Ranger remains the best-selling used car in the market with 4992 units, but also took longer than the average to sell at 50 days.
This was followed by the Toyota HiLux (3643), Corolla (3072) and RAV4 (2371), and then the Hyundai i30 (2287) and Mitsubishi Triton (2101) in fifth and sixth position respectively.
Fluctuating prices of new electric cars is also having an impact on the second-hand market with listings dropping 4.1 per cent and sales falling 3.3 per cent – to 5698 and 2083, respectively – in December.
Of note, manufacturers such as MG, GWM and Nissan have all started to aggressively discount new EV models, making it potentially more attractive for customers to buy new rather than used.
All of this indicates a buyers’ market, according to the AADA, with prospective customers presented an “ample opportunity to strike a good deal” thanks to the oversupply.
“This trend is expected to continue in 2025 as the growing oversupply of new vehicles creates a spillover effected in the used car market,” AADA CEO James Voortman said in a statement.
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