According to Manheims press release.
www.honestjohn.co.uk/news/item.htm?id=5963
Fascinating. I might just sell my new car, and keep the old one...
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The other thing the article misses is the collapse in value of the pound, bringing Euro-rich Irishmen into the UK market.
My prediction was right, but I was far too far into the future.
www.honestjohn.co.uk/forum/post/index.htm?t=66271&...e
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However, note that both Manheim's and my own impressions are that auction prices might now have peaked.
HJ
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However note that both Manheim's and my own impressions are that auction prices might now have peaked.
Indeed, yes. But there cannot be many "investments" that have kept their value over the last 12 months, let alone risen in value. Least of all something that is a wasting asset.
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You might be misinterpreting the message.
What they mean is the average prices of 3 year olds are more in March 2009 than they were in March 2008, not that cars now 4 years old are worth more than they were in March 2008.
HJ
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Nationwide are reporting a 1% increase in house prices, and my estate agent MD friend (150 branches) tells me that March was ahead of target, with more sales concluded than expected.
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Nationwide are reporting a 1% increase in house prices, March was ahead of target, with more sales concluded than expected. March 2009 auction prices UP on March 2008
1. House sales usually pick up in March.
2. With the BoE base rate virtually at 0%, and some lucky people reportedly on tracker rates which are BoE minus 1%, there is a lot of money in the pockets of people who are now saving £1000 or more per month on mortgage payments.
3. The above partly explains the rising prices of second-hand cars and houses, both of which are in short supply.
Cash sloshing around in pockets + savings interest rates worthless + borrowing costs zero + pent-up demand + shortage of supply.
= new short-term bubble.
= another bust coming, but this time very soon.
Edited by jbif on 02/04/2009 at 14:03
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The house price number is noise in the system.
The car price number merely reflects that the market was horribly over-sold. It made no sense to anybody that I was able to pick up a sub-3 year old car for about 17% of its original cost - given that new cars aren't being made any more, and people continue to prang them and scrap them.
The BBC graph newsimg.bbc.co.uk/media/images/45625000/gif/_45625...f suggests that the second deriviative may be approaching zero, but not the first...
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If so, then it is the article that is at best vague and at worst doing the misinterpretation itself. If we take your point that the March '08 cars were 3 years old, then the article refers to the prices of cars a whole year older than that (i.e. 4 years old) being sold in March '09.
If there was any doubt as to the validity of these unprecedented price rises and whether age and mileage variations had an influence, the % retained of cost new since December reinforces the legitimacy. At that time it sat at 29% of cost new for a 46 month old car with 47,000 miles. In January it rose to 32% (47 months/47,000 miles), with a further rise in February to 34% (48 months/48,000 miles) and by the third week in March it had risen again to 36% (48 months/49,000 miles).
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Had posted this before. I noticed that as the Manheim auction I visit is now online. Traders in the hall step back at their limit then a lot of bids come in from the internet. I imagine this had a lot to do with the prices appearing to me to be a lot higher these days.
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A lot of the online bidders are bidding from Ireland, taking advantage of a VAT tax break and the fact their Euros now buy a lot more stock priced in Sterling. (This has been mentioned rather a lot before.)
HJ
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