The Hobbs Parker Blogs

We all know someone who has traded in their battered old banger under the government’s scrappage scheme and is now driving around in a shiny new car, happy at the thought of ‘saving’ £2,000.

According to government reports, the scheme has been a huge success, pumping nearly £400 million into the beleaguered car industry and removing over 370,000 fume-polluting cars from the environment.

But the scheme has had other affects too, not least in the second-hand car market.  Suddenly there’s a real shortage of quality used cars and a dearth of the old run-arounds that were perfect for newly qualified and first-time drivers.

Jon Chapman is one of the South East’s most experience car auctioneers, running Hobbs Parker’s Car Auctions in Ashford.  He points out how scrappage has ended up skewing the market and, perhaps counter-intuitively given the recession, making now a great time to sell a used car – especially at auction.  As he points out, “this is the first time in many years that I’ve witnessed such an unprecedented and sustained growth in prices.  People are drawn by the thought of £2,000 off the price of a new car, but you may get a better deal at auction.”

The change in the used-car market Chapman explains, has been triggered both by the fact that people, worried about job security or money, have been cautious about replacing their cars, but also as some 80 per cent of affordable run-arounds have disappeared from the supply chain.  “The scrappage scheme has been seen as very appealing to a certain demographic and here in the South East, where there has been an even greater take up, many highly serviceable small cars, perhaps belonging to one careful elderly owner, have ended up on the scrap heap instead of being available to a new owner for a few more years’ good service.”

The result at Hobbs Parker’s twice-weekly auctions – every Monday and Wednesday evening - is that prices have risen, with certain models up by around 15 per cent - some as much as 25 per cent higher than before.  Demand is high and at recent auctions around 70 per cent of stock has been sold on the day.  As well as the smaller, older cars now in rare supply, another boom area is four-wheel drive vehicles.   One Hobbs Parker customer was delighted to learn recently that his Land Rover Discovery bought at auction just 18 months ago, is now worth more than he paid for it.

So, if getting involved in the mad rush for the last remaining weeks of scrappage doesn’t appeal and you’re rightly keen to avoid the costs of depreciation with a new car, taking the plunge and simply selling your old car yourself is suddenly much more attractive.

How do you make sure you get the best price?  The process is easy and any reputable car auction house should be able to take you through what is involved.  Hobbs Parker has put together a simple 3-step guide, which can be seen on www.hobbsparker.co.uk/cars, explaining how simple it is to sell a car at auction.  The joy is, of course, the speed with which the transaction happens.  At its purest, you arrive with your car, hand over the documents and keys and Hobbs Parker will then perform the necessary DVLA and finance checks on the car before offering it at auction that evening.  Once sold, the cheque is with you within 48 hours.

A reserve price can be fixed to protect your interests.  Typically though, the price raised at auction – after fees – is not much different than if you’d sold through a dealer or possibly even selling privately.

The advantages are very appealing: no more drafting and paying for ads; no worries about strangers turning up at your house or the inconvenience of cancelled viewings.  And fears as to whether the money will come through are gone too.

Buying is similarly straight-forward.  Hobbs Parker has in place safety measures to protect the customer.  Every car offered for sale is subject to rigorous pre-sale checks so there are no worries about outstanding finance, hire purchase defaults or previously declared accident damage.  This means you are more protected buying at auction than if you purchased a car privately.

And – who knows – with the market as it currently is, you may find yourself driving home in a car with a saving of much more than £2,000 – plus the satisfaction that, by buying a used car, you’re recycling too!

Posted by Sally Randall