Cars sold in hours amid huge demand for second-hand vehicles

Australians are seizing the ‘unique’ opportunity to buy and sell used cars in less than 24 hours without a test drive. See what your car could be worth.

The demand for second-hand cars is so hot buyers are snapping up vehicles within 24 hours of ads going up online – and often without inspecting them in person.

And such is the competition among buyers, sellers are commanding – and getting – the same price for the cars that they paid for as much as four years earlier.

Just over a quarter of users of Carsales’ new online platform Instant Offer sell within a day, with almost 70 per cent selling within a week, often without face-to-face meetings, managing director Ajay Bhatia said.

“We saw the pandemic accelerate these behaviours and the selling of cars is no different – used car price increases have had an impact on private sellers and the speed in which people are hoping to sell,” Mr Bhatia said.

He said a bottleneck in the supply chain was fuelling the demand for used cars because there are so few new vehicles coming into the country.

Mr Bhatia said it was “completely incredible” cars were selling at the same price to what they were purchased for up to four years ago.

“Car prices are very unlikely to come down in 2022 and supply crunch is likely to continue, which will then mean it creates a great opportunity for people to sell their private cars at premium prices,” he said.

It comes as the car sale war heats up across Australia as other companies fight to meet the demand for second hand vehicles, with many now worth $10,000 or more than new equivalents. Some models are even defying the market to sell at almost double the price.

People who own some of the most sought after cars like the Toyota RAV4 hybrid, are taking advantage of waiting lists approaching 12 months, and are selling their lightly-used vehicles for a profit, according to vehicle valuation service Redbook.com.au.

The most sold car models via Instant Offer are Mazda 3, Toyota HiLux and Holden Commodore, while SUVs are the most popular vehicle type overall.

The Mazda 3 is a sought after vehicle.

Other platforms such as Cars24, CarConnect and Carsales Select work by offering set prices, consumer warranties and fast delivery – and the transaction can be done from the comfort of the buyer’s home.

It comes as car makers are also investing in new sales models, with manufacturers ranging from established giants Honda and Mercedes to relative newcomers Genesis and Polestar, increasingly bypassing the conventional dealership sales structure to sell cars directly to customers.

The change caters to younger motorists accustomed to buying goods online, as well as people who aren’t comfortable haggling with sales stuff to get the best price.

Ramsgate resident Bill Gregory recently bought a second hand Toyota RAV4 off Cars24, a new app and website that specialises in selling used cars. Picture: Toby Zerna

Bill Gregory, 63, from Ramsgate in Sydney recently bought a 2017 Toyota RAV4 for $27,000 drive away on Cars24.

“I started looking around at used car dealerships, but most cars were too pricey for my budget. “And then I saw this ad on Cars24 and decided to give them a try. Being online made it very convenient and the whole experience was fantastic.”

He said he bought a car after 2-3 days of looking online.

“CARS24 gave me a great deal to trade in my existing vehicle, and the whole process from there was unbelievable – everything from quick and convenient online financing, to free delivery to my doorstep,” he said.

Don O’Sullivan, professor of marketing at the University of Melbourne, said selling a car was a costly transaction for people in terms of the effort involved, so anything that made that easier was going to be popular.

The Toyota HiLux is a vehicle Aussies are scrambling to buy.

“Covid has also accelerated the shift to online … They’ve spent the last two years buying and selling on Amazon and watching Netflix, then the idea of what now appears like a very archaic way of, of selling their car and very effortful way of selling the car, and you can see (how this) becomes hugely appealing,” he said.

Mr Bhatia said the migration to online car sales would continue, but wouldn’t replace the traditional car yard yet.

“I think that’s going to be a mix,” he said.

“We tend to follow a lot of the trends, especially the US … And there is a trend towards online selling.”

For now, there is money to be made on cars many Aussies thought would lose value on.

“It’s really a unique opportunity for consumers and they’re sitting on a car that they don’t need anymore,” Mr Bhatia said.

“This is the time to make some money on their cars. Who would have ever thought appreciating assets not a depreciating asset?”