Friday, March 20, 2009
Category:
Secured Loans
According to AA Personal Loans, their latest Car Purchase Index (CPI) has revealed that quality is now taking precedence over quantity in the minds of car buyers.
Despite the average value of car loans remaining relatively stable since March 2008, consumers are now 62 percent more likely to purchase a second hand, or ex-demonstration, vehicle as opposed to a new one.
The CPI shows that the average expenditure of a car buyer has remained static even amid the current economic climate. 52 percent of respondents stated that they intended to purchase a ‘new second hand’ vehicle in the region of £5,000 and £9,999.
With a 31 percent drop in new car sales, consumers are taking advantage of the fact that they have more flexibility to negotiate better deals within the used car market. In addition, further figures from the second hand car market point towards some vehicles depreciating by up to 31 percent. This means that a better class of vehicle is now attainable for the same amount of money that would have been spent this time last year.
Editor of Car Dealer magazine, James Baggot, commented: "It's been a turbulent year for the used car dealerships: not only has the industry had to deal with consumers changing their spending habits because of the credit crunch, it's also had to compete with massive variation in fuel prices. All this has led to a shift in what car buyers look for in a second hand vehicle, such as better economy, better comfort and better performance, but crucially they're now looking to get more for their money than ever before.
"While sales are still strong at dealerships across the country, many forecourt salesman are selling cars that would be worth £24,700 two years ago, for just £17,525 today. That's a saving of over £7000."
Head of AA Personal Loans, Mark Huggins, said: "The credit crunch has turned into a recession which means consumers are now looking to get even more value for money than before. As a result, second hand car dealerships across the country are finding themselves having to offer higher value vehicles at lower prices to make a sale, with savings of almost a third on certain models.
"Comparing information from the Car Purchase Index and industry figures on depreciation, it's clear to see that while the purse strings may be drawn a little bit tighter, this could actually be one of the best times to buy a car. Now is the time to spend the pennies if you want to get the car of your dreams."
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Those who would like to make their dream car a reality, but are lacking the funds to do so, may wish to consider taking out a
secured loan to make the purchase. Available to homeowners with a mortgage, this finance option could be the solution for those that are looking for the money to take advantage of the current opportunities within the car market. Secured loans are available over a term to suit the borrower from 5 to 25 years.
