Weekly auction update from Andy Conde - 28th September 2015
For the first time this week, we are starting to see a slight change in the markets. Last week I said that a north-south divide is always a sign that things are on the turn and this appears to be the case however, there are a few caveats in that statement.
First, there are certainly more vehicles around in the south and we are seeing many of our southern sites filling up very quickly with the numbers of entries rising significantly. Consequently, buyers have a much greater choice and are picking and choosing what they buy rather than getting into the mode of panic buying for the sake of it.
As I say week after week, quality vehicles will make quality money and this is still the case. Up in the north, the supply of stock is not as plentiful although we are still seeing conversion rates up in the 80% and CAP prices very close to the golden figure of 100%.
4 or 5 years ago a lot of auctions were full of buyers from the sub-prime finance sector but, over the past 18 months these have faded away. However there does appear something of a resurgence and last week in Manchester we had 3 or 4 sub-prime buyers in the hall all looking to buy 4/5 year old Astra, Vectra, Insignia and Mondeo with up to 80k on the clock and quite happy to pay in excess of cap clean.
The big surge of vehicles still has not happened and when I speak to buyers, the first question they ask is where all the cars are?
I must admit I thought the flood gates would have opened by now but there are still no real signs of any deluge, it will happen - but the question is when.
In my view, it is far healthier to get a slow increase than a tsunami as this will keep both buyers and vendors happy, the closer we get to December, which is usually one of the most expensive months for buying used cars at auction, the more interesting it will get.