When is the best time to buy a car?

Best times to buy a used car

Car prices are often lower when dealers need to move surplus stock. Used car supplies tend to peak around the same time as new car sales, as many buyers will part-exchange their old car to get behind the wheel of a new one.

This usually happens around March and September each year, when the number plate changes occur. Just bear in mind that while the plates launch at the beginning of these months, you may have to wait a week or two for dealers to process the used cars and prepare them for sale.

Then, to help move this extra stock, dealers will mark down their prices. So, if you shop for a used motor in mid-March or September, you’ll be in a better position to negotiate with the dealer – and you’ll also benefit from a wider choice in the showroom.

• How weather affects car used prices

  Did you know that short-term weather changes can also influence car dealer’s prices? Wet weather can reduce footfall at dealerships, as many buyers don’t want to spend time walking around a cold, wet forecourt. Even if they have a few customers, salespeople may have a tougher time closing deals in inclement weather. After all, a test drive is much more enjoyable on a clear, sunny day.

  With that said, you may be surprised to learn that car sales can also suffer during hot weather! On those rare balmy days when everyone seems to run to a pub, beach, or their neighbour’s barbeque, dealership forecourts are often left deserted.

  So, during a long spell of bad (or glorious) weather, you’ll notice that many dealers offer discounts, as they’re keen to attract customers and close more deals.

  In fact, even private sellers may lower their prices when the weather is deterring prospective buyers. Therefore, even if you’re planning to buy a car privately, it might pay to keep an eye on the weather forecast.

• End-of-quarter deals

  Car salespeople have quarterly targets to hit, so if you visit a dealership in the last month of a financial quarter (March, June, September, or December), you may find they’re more eager to offer you a good deal.

  The offers may be even better in March and September, when the dealerships are keen to clear old stock.

• Christmas and new year clearances

  Many dealerships suffer a lull in custom during the Christmas holidays. So, they’ll offer better deals to attract more footfall and improve their end-of-year sales figures.

  When the new year arrives, dealers will also be keen to mark down and sell any cars that they couldn’t move during the festive period.

• Car tax savings

  When you tax your car, the DVLA will charge you for a full month’s car tax for the remainder of the first calendar month. Therefore, it’s more economical to collect your car at the beginning of the month.

  Although your savings will be fairly minimal for lower emission cars, you could pay a few hundred pounds each year to tax an older car, meaning you could effectively save a tank of petrol just by taxing your car at the right time!

When is the best month to buy a new car?

If you’re looking to get a new car at a bargain price, consider buying in February or August (just before the March/September plate changes).

However, if you want to enjoy the prestige of having a brand-new motor for as long as possible, buy in March or September. Cars that were first registered near the plate change dates tend to hold their value slightly better - but this benefit tapers off after several years.

A salesperson may make further discounts to ensure they hit their quarterly target. (Quarterly deadlines are usually at the end of March, June, September, and December).

You might get a good deal on a car in January, if the dealership couldn’t sell it the previous year.

How model updates influence new car prices

When a car manufacturer is due to launch a new generation (or a mid-generation facelift) the older versions will come down in price.

So, if you have your heart set on a particular model, it’s worth checking whether there’s an update around the corner. If there is, this could be a great opportunity to grab a bargain. However, if you’re dead set on having the latest features and technology (and want to enjoy the prestige of driving a new model), it’s worth waiting for the next generation.

You may also be able to get a good deal on an ex-demo car, if the dealership is clearing the way for new stock.

Factory discounts

Sometimes, car manufacturers will produce more units than they are able to sell. For a limited time, dealers may offer generous discounts to move low-selling models (sometimes a third or more). So, it’s certainly worth looking out for these offers.

Seasonality and car prices

‘Seasonality’ affects the demand for different car types as the weather changes – and when a specific car type is in high demand, you can expect prices to rise accordingly.

For example, demand and prices for convertibles are highest in the spring, when buyers are looking forward to a summer of top-down Sunday drives. Meanwhile, 4x4s, sports utility vehicles (SUVs), and multi-purpose vehicles (MPVs) can traverse snow and sleet better than most, so their prices peak during the colder months.

Scoring deals during holiday sales events

If you’re hitting the holiday sales in the hope of finding a great car at a bargain price, here are a few pointers to bear in mind:

• Before visiting the dealership, research the list price (if buying new), so that you’ll know if you’re getting a good deal.
• When a dealership is running a sale, you’re in a better position to haggle.
• Consider the minimum and maximum amount you’re willing to pay (but don’t give this information away to the dealer).
• When haggling, try to meet the dealer in the middle.
• Asking the right questions when buying a used car, can help you decide whether it’s right for you – and may also help you leverage a discount.
• When it isn’t possible to offer a further monetary discount, dealers may throw in ‘sweeteners’, such as a warranty, free servicing, floor mats, and extra equipment. Don’t be afraid to ask.
• If you’re buying second-hand, it’s worth considering an approved used car. Their mileages are usually low - and they’ve passed stringent checks to earn the dealer’s ‘approved used’ sticker.
• Part-exchanging your old motor can be a convenient way to sell it and get the keys to a newer model. However, you probably won’t get the best price for it, as dealerships are focused on making profit.
• You could make your money go further by selling your car elsewhere. Selling your car privately could help you raise more cash towards your next purchase.
• Alternatively, webuyanycar can often beat part-exchange quotes. Enter your reg number and mileage into our free car valuation tool to find out how much you could get!

What is the ‘agency model’ - and how is it affecting car buyers?

• The traditional franchise model provides dealers with a set profit margin, based on the recommended retail price (RRP) – and they are typically awarded bonuses for meeting their targets.
• However, certain manufacturers are introducing (or have already introduced) the ‘agency model’. Under this model, customers will be shown a single, fixed price online. The manufacturer handles the transaction with the customer – and this is usually done online.
• The dealer merely receives the car, prepares it – and then hands it over to the customer, in exchange for a fixed handling fee (typically 5-7%). This is less than what they could make under a franchise model (up to around 14%) - but it’s a guaranteed income on every sale and can’t be chipped away by haggling customers.
• So, what does this mean for the you, the consumer? With fixed prices, there is less uncertainty over whether you’re getting the best deal.
• Some consumers prefer to build a relationship with dealers (particularly local family dealerships). Critics have expressed concerns that part of that experience will be lost as more manufacturers switch to the agency model.
• However, some manufacturers believe that a standardised management of the process, backed by marketing and advertisements will help to improve the customer experience.

Where do manufacturers stand on the agency model?

The impact of economic conditions on car prices

• Economic growth, employment levels, and the rate of wage increases all influence how much consumers are willing to spend on a car.

• When inflation is high, consumers have less to spend and may struggle to afford a new car. This increases the demand for used cars.

• When interest rates are low, financing a car becomes more affordable, which tends to increase demand. However, when interest rates are too high, car finance becomes less affordable – and demand falls.

• Global incidents such as the COVID-19 pandemic can significantly affect car prices. Severe delays in the production of new cars led to a spike in demand for used cars, which created a huge increase in used car prices.

• In the wake of COVID, a persistent global lack of semiconductors continued to stifle car production and increase manufacturer costs, which led to rising prices. However, the situation is now improving.