The Government Scrappage Scheme may have kick started the stagnant car industry, but it has had a knock-on detrimental effect upon the used car sales trade.
As people have opted to scrap their 10 year old cars in return for the 2,000 pounds discount from a new car purchase, that has had a direct effect on the availability of used cars as there simply aren't as many around anymore.
In fact, many used cars have actually started to increase in price with many rarer cars increasing considerably. Luxury vehicles such as a used BMW or used Lexus for example, are always going to be sought after and as there are less of them about, they are starting to increase in value.
A used BMW Z8, one of the German manufacturers more rarer models of recent years with under 6,000 having been built and sold, are being snapped up by car salesmen at inflated prices as they are well aware that their value will continue to increase.
Used BMW dealerships have been buying Z8 cars for as much as 70,000, pounds more than 35 per cent more than their market price. And it isn't just the Z8 that is increasing in value either. Many other used
BMW models are on the market for considerably more than the book price.
Whilst car buyers continue to take advantage of the Government Scrappage Scheme the used car market will become more sparse and the more sought after vehicles, such as used BMW's, will continue to rise in value. The used car market has never seen conditions such as this, where demand cannot be met by supply, thus prices rise and vehicles do not depreciate, instead they appreciate!
Also, because of the economic downturn and recession one of the first expenses that people are cutting back on are cars - many people who had intended to upgrade their car have instead had to put that idea on the backburner. As many are cutting down on their holiday expenditure, they are also cutting back on motoring expenses.
This has also affected the used car market as less people are trading cars. With less cars on the market, many rarer models - as with used BMW Z8's - are going to increase further in value over the coming months until the economy sorts itself out and people start spending again. I'm not usually one for cliches but it really is a funny old world sometimes.
Author Resource:-
Thomas Pretty is a motoring journalist with many years of experience writing about the car sales industry. Find out more about used BMW at http://www.cooperbmw.co.uk/
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