UK Used Car Prices: Why 'Flat' is the New 'Strong' - And Where the Real Money is in 2026

Let’s be straight: we’re heading into a market that looks stable on the surface, but it's pulling in two completely different directions underneath.

You see the headlines that say used car prices are still up year-on-year (YOY). That’s true. The average retail price in November 2025 was up +0.5% YOY, making it the fourth straight month of YOY growth. This stability is keeping values significantly above pre-pandemic levels.

But it’s easy to miss the detail that matters most for cash flow and stock turnover right now: prices fell -0.5% month-on-month (MOM).

For senior stakeholders, this isn't just a seasonal dip; it's a critical signal. If you price using only the positive YOY number, you risk overconfidence, slow movement, and being left with stale stock as we gear up for Q1 2026. Smart pricing in this environment means interpreting the YOY growth as resilience but treating the MOM softening as a warning to keep your finger on the pulse.

1. The Value Is Ageing Up

When we look deeper into the data, the 'average' price is masking a huge split in performance. Forget the headlines about the overall market for a minute and focus on where the money is actually moving:

• Budget Cars are Booming: Vehicles aged 10 to 15 years-old are the runaway success story, showing exceptional price growth of +8.1% YOY. This isn’t a coincidence. With inflation running hot and disposable income squeezed across the UK, consumers are focusing on affordability and necessity. Demand for these reliable, budget-friendly cars continues to outstrip supply.
• Nearly-New is Softening: At the other end of the spectrum, cars under 3 years-old saw prices fall by -1.1% MOM. This is a direct effect of fleet and leasing vehicles starting to return to the market in higher numbers. More supply means more pressure on pricing.

Marsh Finance Takeaway: Your pricing strategy needs to be flexible enough to see a 12-year-old car as a high-margin, fast-turnover asset, while treating a 2-year-old car with more caution on initial price position.

2. The Electric Car Question: The RV Reality Check

For finance brokers and leasing companies, the most pressing issue is still Electric Vehicle (EV) residual values (RVs).

Used EV prices softened by -5.5% YOY in November. Why? Because the supply of younger used EVs is increasing, and manufacturers are using deep discounting on brand new EVs (averaging 12% off RRP) to hit regulatory targets.

This combination of increasing supply and aggressive new car pricing is pushing down values for used stock. Industry forecasts from the BVRLA show that most leasing firms expect EV RVs to fall further in 2026.

Marsh Finance Takeaway: The industry must work together to model future RVs carefully. The risk is high for EVs right now. For the classic petrol and diesel stock, especially the 7-to-10-year-old models, the RV outlook is much more stable, if not positive.

3. Sourcing Strategy For 2026: The Gap Is Coming

Looking beyond the next quarter, the biggest operational challenge for dealers will be sourcing vehicles in the mid-age cohorts.

• Short-Term Gain: We will see an uplift in overall used car volume in 2026, driven by vehicles that first registered during the 2023 fleet booms finally coming back. This is good for younger stock.
• Long-Term Pain: But from 2026, the shortage of new cars sold during the pandemic will finally hit the crucial 5-7-year-old and 7-10-year-old segments. These are the workhorse cars that the UK market relies on. This supply gap will intensify competition for quality stock across the industry.

Marsh Finance Takeaway: Smart dealers should already be widening their sourcing channels, focusing on securing stock in these mid-to-older age bands now. If you can get it, the economics of demand vs. supply will protect your prices and profit margins in 2026.

At Marsh Finance, we understand that successful trading in 2026 relies on making decisions based on segments, not just averages. By focusing on the strength of older ICE vehicles and carefully managing the risk in newer and electric stock, you can protect your margins and thrive in a resilient, albeit complex, UK used car market.

Don't Just Read the Market, Finance It Right

At Marsh Finance, our focus is on the vehicles you sell, the petrol and diesel cars that still account for nearly 90% of the used market. The challenge for 2026 isn't the electric car trend; it's securing the resilient, traditional stock that the UK consumer is actively seeking.

We provide the funding confidence and adaptable solutions you need to capitalise on these shifts. If you’re ready to partner with a finance provider that truly understands the value retention in the 10-year-old car boom, can accurately model the stable RVs of ICE vehicles, and offers the flexibility to support your stock acquisition in a tightening supply market, talk to us.

Let's build a profitable 2026 together.

Find out how Marsh Finance can support your dealership now