If you’re in the market for a new set of wheels, then you should get ready to play hardball.
Now could be a good time to get a good deal on a good used car, as multiple factors collide to bring down prices.
If you’re considering buying a second hand car any time soon, then knowing about the state of the market could help you drive a harder bargain.
Here’s what’s going on – and how to make the most of it.
First, there’s currently an abundance of good quality used cars in the market.
Many Brits now drive new cars bought through PCP deals, meaning they hand their car back in after three years and get a new one. This means an increase in the number of used cars in the market, including many that are only three years old and in good condition.
Dropping demand (and the Brexit effect)
On top of the glut of cars, there also appears to be a slight drop in demand. Stats from the Society of Motor Manufacturers and Traders show that sales fell 2.1% in 2018 compared to the previous year, meaning almost 168,000 fewer cars were sold.
Some of that is down to Brexit concerns. Research from Close Brothers Motor Finance shows that 48% of drivers say ongoing concern about Brexit has had a negative influence on their decision to buy a car.
And 18% of drivers say they have been put off buying a vehicle in 2019 because of confusion over the best fuel type.
So, if supply is high but demand stays the same or drops, that means dealerships have to compete harder for customers. And that could make now the perfect time to find a bargain.
How to drive a bargain
Most of us only buy a new car every few years, and that can mean we feel at a real disadvantage when trying to get a good price. After all, the staff on the forecourts sell cars every day and know what they are doing.
But it’s important to remember that they want to make a sale, and that they will very often have flexibility over the price. This means if you take the time to haggle with confidence, you could save a significant amount.
Know your stuff
Getting a good price is about more than being brave in negotiating - it’s about doing as much research in advance as you can.
Look at the online listings for the car model you’re interested in and understand what kind of prices are being asked for them – and how those prices are affected by mileage and trim. That way, you’ll understand the value of the model you’re looking at just as much as the sales person.
It’s also vital not to get too carried away with any car. The sales team will always apply a little pressure and imply that there’s a crowd of people waiting to snap up a car if you don’t act fast.
But it’s better to wait until you’re sure that’s the right car for you and risk losing it than to buy a car that’s not right for you.
Research from the Money Advice Service shows that 64% of people who tried to negotiate a better price when buying a car were successful, which is pretty good odds.
When talking to the salesperson, be polite and don’t give too much away – never tell them your top limit.
If you’re buying with cash or a separate loan from your bank then don’t reveal that until you’ve agreed a price. Dealers often make more money by selling finance and if they know they aren’t going to then they may drive a harder bargain.
And don’t be afraid to leave the showroom if you can’t get the salesperson to move on price. Remember that glut of used cars? You can find a bargain somewhere else.
Check your credit score and all your car finance options
If you are about to buy a car, then there’s a very good chance you’re going to use some form of credit.
According to the Finance and Leasing Association, more than 91% of private new car registrations in 2018 were made with finance provided by its members. And a sizeable chunk of second hand cars are also bought using credit.
If you want to bag a bargain before Brexit, then it’s worth looking carefully at your car finance options.
Never assume that the finance being offered in the car dealership is the best deal because there is a good chance it won’t be. It’s important to compare different loans to see if you can find cheaper credit.
Knowing your credit score can show you whether you are likely to qualify for the best deals, but ClearScore can help even more than that.
You can view and compare different car finance offers in your ClearScore, potentially gaining a cheaper rate and savings hundreds of pounds.
We also have guides to everything you need to know about car finance, so that you can be reassured that you’re not overpaying for a car or for credit.