We are not here to bombard you with the state of our economy, inflation rate negativity and petrol price hikes. These daily challenges are par for the course in our current South African climate. What we are here to say is that when the economy takes a downturn, the impact on the man on the street is selective and relative. This is most clearly seen in how people tighten their belts, cutting back on non-essential spending and reassessing their financial priorities. While this can be challenging, it also creates a unique opportunity for those looking to sell their cars.
Despite the incessant influx of bad news, now is a good time to sell your car in South Africa. Economic influences – like supply chain improvements and fluctuating interest rates – mean that demand for quality used vehicles remains relatively strong.
“In South Africa, new vehicle pricing is not driven by demand. As around 70% of our vehicles are imported, factors like exchange rates and tax duties play a big part in the price hikes. The used car market, on the other hand, is entirely demand-driven, so the fact that we’re seeing a rise in the prices of used cars shows a clear increase in demand for second-hand vehicles,” –Kriben Reddy, vice president of auto information solutions for TransUnion Africa.
(At Weelee, we are all about positivity and finding the silver lining for our customers looking to buy or sell their cars).
Here’s the rationale as to why tough economic times might just be the perfect time for you to get a great deal when selling your vehicle.
Basic economics | Supply & demand dynamics
It’s not rocket science; it’s simply Economics 101. In a robust economy, the market is flooded with new cars with buyers enticed by the latest models, upgrades, the allure of that ‘new car smell’ and competitive deals. However, fewer people can afford to buy new cars during an economic downturn. This shift in buying behaviour increases the demand for reliable, affordable used cars.
This means you are in a relatively strong position if you are currently looking to sell your car. With more buyers looking for second-hand vehicles, you have a larger pool of potential customers to leverage.
The basic laws of supply and demand work in your favour: when demand is high and supply is relatively lower, prices tend to rise. This can help you sell your car at a better price than during more prosperous times.
Buyers’ psyches | Value over luxury
Economic hardships change the way people think about purchases. Buyers become more value-conscious, focusing on getting the most for their money rather than indulging in luxury purchases. They are also aware of the reality that trade-in prices seldom keep track of new car price hikes.
It’s all about needs over wants. Even if a buyer is looking for a vehicle upgrade, priorities dictate practical, reliable transportation that won’t break the bank. A used car, which can offer significant savings compared to a new model, becomes an attractive option.
South African car buyers are understandably worried about rising fuel prices. If your car is known for being fuel-efficient, make sure to emphasise that in your listing. Additionally, import restrictions increase the resale value of popular local brands. If the vehicle you are looking to sell fits this brief, leverage these second-hand market nuances in your favour.
This is where you – as someone poised to sell your car – come in as a strategic player in this transactional chain. So take advantage of the market and do all you can to make sure your car makes an impression and stands out from the rest.
Take note of the following: Buyers during tough times are more likely to appreciate the benefits of a well-maintained used vehicle. They understand that cars depreciate quickly and that buying used allows them to avoid the steep depreciation curve associated with new vehicles. This mindset makes your used car, especially if it’s in good condition with a solid and transparent service and repair history, very appealing.
The second-hand solution | Practical & cost-effective
For many, a second-hand car is not just a cheaper alternative; it’s a practical solution that meets their needs without unnecessary expense. New cars lose value rapidly; up to 20% in the first year alone. In contrast, a used car has already undergone this initial depreciation, meaning buyers get more value for their money.
Moreover, financing a used car can be easier on the wallet. With lower overall prices, buyers may need smaller loans, leading to lower monthly payments. For cash-strapped individuals, this can be a significant advantage.
The Weelee difference | Leveraging the scenario as a seller
If ever there was a time to come be positive rather than negative, it is right now as a local citizen looking to sell your car.
Here are 3 top tips from our Weelee team:
- Highlight value and reliability: Emphasize the cost savings and the car’s reliability in your listings. Provide detailed maintenance records and warranty information to build trust with potential buyers.
- Competitive pricing: While the demand is higher, pricing your car competitively can attract serious buyers quickly. (We know how easy it is to become emotionally attached to your wheels, resulting in overvaluing them). Research similar models in your area to get an idea of the realistic going rates.
- Market smartly: Using Weelee’s online platform to sell your car – accompanied by high-quality photos and a detailed, honest description – will give you a competitive edge offer and the most hassle-free way to sell your car for the best price.
There is so much you cannot control in life. But while an economic downturn poses legitimate challenges, it also presents a unique opportunity for selling your used car. High demand, value-conscious buyers, and the practicality of second-hand vehicles all work in your favour.
