This coincides with new car sales posting their first growth month in nearly three years in November, and Australia officially being out of a technical recession.

Moody's Analytics reports from May through August, used car sale prices jumped anywhere from 6% to 11% on a monthly basis, while in November, price growth was just under 1%, with the truck/ute/SUV segment falling in price slightly.

Still, November 2020 prices are 33% higher than prices reported in November 2019, and in the truck/ute/SUV segment, prices are 45% above what they were last year. 

In the market for a new car? The table below features car loans with some of the lowest interest rates on the market.

Update resultsUpdate
LenderCar LoanInterest Rate Comparison Rate* Monthly Repayment Interest Type Vehicle Type Maximum Vehicle Age Ongoing Fee Upfront Fee Total Repayment Early Repayment Instant Approval Online Application TagsFeaturesLinkCompare
6.24% p.a.
7.36% p.a.
1 year
  • Available for purchasing new and demo vehicles
  • $5,000 to $150,000 loan amount
  • Redraw facility available up to $5000/day
  • Required: Good credit history, stable employment history. Aus citizenship or PR.
6.34% p.a.
8.36% p.a.
1 year
6.57% p.a.
7.19% p.a.
No Max
Loan amounts from $2k to $75k
  • Available for any new motorised vehicle
  • No ongoing or early exit fees
  • 1-7 years loan terms. Pay monthly, fortnightly, or weekly
  • Get quick decision. Funds in 24 hrs if approved
6.09% p.a.
7.21% p.a.
1 year
  • Discounted rate on qualifying electric cars
  • Up to 7 yrs loan term
  • Redraw available up to $5,000/day
Important Information and Comparison Rate Warning

All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here.

The comparison rates in this table are based on a loan of $30,000 and a term of 5 years unless indicated otherwise. The comparison rates for car loans and secured personal loans for the relevant amounts and terms are for secured loans unless indicated otherwise. The comparison rates for unsecured personal loans are applicable for unsecured loans only. WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. Comparison rates are not calculated for revolving credit products.

Monthly repayment figures are estimates only, exclude fees and are based on the advertised rate for the term and for the loan amount entered. Actual repayments will depend on your individual circumstances and interest rate changes. Rates correct as of . View disclaimer.

Moody's Analytics senior economist Michael Brisson said the traditional rules of depreciation may no longer apply.

"It could be said that this is no longer your father’s used-car market where 20% of the vehicle’s MSRP [retail price] was lost when driven first off the lot," he said.

"In November, and a bit more so in October, many low-kilometre utes were selling for more than 95% of their MSRP.

"Comparatively, astronomical price gains by utes over the previous six months have made some consumers reconsider a passenger car despite a secular change in preferences."

Moody's Analytics' report points to a simple supply-and-demand issue for the reason used car prices have skyrocketed, with constrained supply due to COVID-19, and fewer new vehicle sales meaning fewer trade-ins.


The used car market in 2021

Mr Brisson expects seasonally adjusted used vehicle prices to "turn south" as 2021 approaches. 

"The price drop is not expected to be steep or sudden, but rather a slow turn and flattening as the economy returns to normal patterns of driving and vehicle usage," he said.

"If vehicle demand drops significantly as the virus is effectively managed and people are vaccinated, then many cars purchased for use during the pandemic may hit the market at once.

"In this case, prices will fall faster than currently expected. Still, this risk remains limited as people will likely hold on to their vehicles as things slowly return to normal."

The 'flattening curve' of used car sales prices in November could also be attributed to public transport, with routes searched up by nearly 30%. 

Still, however, public transport use remains 25% below pre-pandemic levels, according to Apple mobility data. 

Public transit use could return to normal in 2021, Mr Brisson says.

"Public transit offers convenience and affordability to many people, and the reasons people chose to use public transit before COVID-19 will again take hold once the virus is no longer a deciding factor," he said.

"This will lead to less overall demand for personal vehicles."


Photo by Ruffa Jane Reyes on Unsplash

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