Used Cars Under £5,000 Lost 3.4% of Value in August, Cap HPI Data Shows

• Cap HPI’s September 2026 market overview shows used cars priced under £5,000 lost 3.4% of their value in August, the steepest fall of any price band.
• A typical three-year-old car lost 0.9% (£195) on the average August to September move, against 0.1% in 2025 and a long-run average of 0.6%.
• Three-year-old diesel cars lost 1.5% and petrol cars 1.0%, while electric cars gained 0.1%.

Cheap used cars are losing value faster than any other part of the UK market. Cap HPI’s Car Market Overview for September 2026 shows cars priced under £5,000 lost 3.4% of their value in August, nearly four times the 0.9% lost by the average three-year-old car. On a car worth £4,000 at the start of the month, 3.4% is £136 (the site’s own arithmetic, not a Cap HPI figure). The people who pay are owners of older, lower-value cars, and anyone planning to sell one this autumn.

Why a £5,000 Car Loses Value Faster Than a £25,000 One

Cap HPI is a vehicle valuation company, and its monthly Car Market Overview tracks what it calls book movement: the change in the guide value of a car from one month to the next. The September 2026 edition holds data as of 25 August 2026 and splits the movement by age, price band, fuel type and body style. It also quotes new and used car sales figures from the Society of Motor Manufacturers and Traders (SMMT).

Across the whole market, the average book movement in August 2026 was a fall of 0.5% for a one-year-old car covering 10,000 miles, 0.9% for a three-year-old car with 60,000 miles, 1.6% for a five-year-old car with 80,000 miles and 2.7% for a ten-year-old car with 100,000 miles. The older the car, the faster it lost value.

The three-year-old figure is the benchmark Cap HPI reports most often, and it translates to £195 in cash terms. That compares with a fall of just 0.1% over the same August to September move in 2025, and with a long-run average of 0.6%. This year’s fall is larger than last year’s and 1.5 times the long-run average.

Price band is where the gap opens up. Cap HPI’s average book movement by price band was:

• Under £5,000: down 3.4%
• £5,000 to £10,000: down 2.0%
• £10,000 to £15,000: down 1.2%
• £15,000 to £20,000: down 0.7%
• Above £20,000: down no more than 0.6%

In percentage terms, the cheapest cars fell almost six times as fast as cars above £20,000. In cash terms the gap is much smaller. Using round numbers (the site’s own arithmetic), a £4,000 car losing 3.4% drops £136, a £7,500 car losing 2.0% drops £150, a £12,500 car losing 1.2% drops £150, and a £25,000 car losing 0.6% drops £150. A cheap car does not lose more pounds than an expensive one. It loses a far bigger slice of what it is worth, which is what hurts when the car is the only asset you are selling or part-exchanging.

Fuel type changes the figures too. For three-year-old cars, Cap HPI reports diesel down 1.5%, petrol down 1.0%, plug-in hybrid down 0.9% and hybrid down 0.1%, while battery electric cars rose 0.1%. On a £10,000 car (own arithmetic), that is a fall of £150 for diesel, £100 for petrol, £90 for a plug-in hybrid and £10 for a hybrid, against a £10 rise for an electric car.

Electric cars did not move together, though. Cap HPI shows electric cars priced £5,000 to £10,000 rose 0.4%, those at £10,000 to £15,000 rose 0.3%, £15,000 to £20,000 rose 0.2% and £20,000 to £30,000 rose 0.4%. Electric cars under £5,000 fell 2.1%, those at £30,000 to £50,000 fell 0.9% and those above £50,000 fell 1.3%. The cheapest electric cars followed the same pattern as the cheapest petrol and diesel cars.

Body style shows in the data as well. At three years old, coupe cabriolets fell 2.0%, large executive cars 1.7%, MPVs and luxury executive cars 1.2%, upper medium cars 0.6% and superminis and city cars 0.3%. SUVs fell 1.0% overall, with small SUVs down 1.1%, medium SUVs down 1.0% and large SUVs down 0.8%.

How Fast Used Cars Sell and What Cap HPI Expects Next

Time on the forecourt is the other half of the cost. SMMT figures quoted in the Cap HPI overview show used cars took an average of 34 days to sell in the second quarter of 2026, down from 37 days. Independent dealers took 40 days (from 44), franchised dealers 33 days (from 35) and supermarkets 29 days (from 30). Diesel cars took 39 days to sell, petrol cars 34 and electric cars 29.

Petrol and diesel cars made up 86.7% of used sales in the quarter. That was 1,121,243 petrol cars, down 1.2% on a year earlier, and 620,045 diesel cars, down 7.2%. Used electric car sales reached 110,761, up 67.0%, a 5.5% share, while used hybrids reached 130,825, up 31.2%.

At auction, Cap HPI reports that electric cars needed an average of 1.2 attempts to sell, hybrids 1.4, plug-in hybrids 1.5 and petrol and diesel cars 1.8. Petrol and diesel cars needed the most attempts to find a buyer.

Cap HPI’s own outlook adds some history. September values have risen in 8 of the 12 periods from 2012 onwards. Excluding 2020 and 2021, the average September to October move for a three-year-old car is a fall of 0.1%. The overview also says part-exchange and defleet supply was expected to rise into late September and October ahead of the plate change, adding pressure on values, especially at the older end of the market.

The new car market sits behind all of this. Cap HPI’s overview puts July 2026 new car registrations at 156,571, up 11.7% on a year earlier, with battery electric cars on a record 27.5% share. Year to date, registrations stood at 1,294,499, up 9.5%. More new cars sold means more trade-ins coming back into the used market over time, though Cap HPI does not put a figure on that effect.

There are limits to what these figures show. Cap HPI book values are guide values used in the motor trade. They are not the asking prices on listings, and an individual car can sell for more or less than its guide value. One month of movement is also not a trend. At the time of writing, the September 2026 edition was the latest Cap HPI overview available to read in full, so the August figures could already have moved.

Can You Avoid It?

You cannot change the market, but the figures point to a few practical steps for owners of cheaper cars.

• Price the cost of waiting. At the August rate, a £4,000 car loses about £136 in a month. If you already plan to sell, listing sooner limits that loss. If the car is going to stay with you for years, a single month of movement is not worth reacting to.
• Compare more than one valuation. Trade guide values drive many part-exchange offers. Ask a dealer for the part-exchange offer in writing, then compare it with at least two online valuations and with similar cars on sale locally before you agree.
• Shorten the time to sell. Independent dealers took 40 days on average to sell a used car in the second quarter, against 29 days at supermarkets. A car that is clean, has a current MOT and has its service history to hand is easier to sell, and a faster sale means fewer weeks of falling value.
• Think about timing around the plate change. Cap HPI expected extra part-exchange cars in autumn, with the most pressure on older cars. A private sale puts your car in front of buyers outside the dealer trade, though it takes more effort and carries its own risks.
• Use the fuel type figures when choosing your next car. Over August, three-year-old hybrids lost 0.1% and electric cars gained 0.1%, against 1.0% for petrol and 1.5% for diesel. That is one month of data, not a forecast, and running costs, charging access and purchase price all count too.

For most drivers the lesson is simple. The cheaper the car, the larger the share of its value it can lose in a single month, so a £4,000 car deserves a more careful look at timing than a nearly new one. Check Cap HPI’s next monthly overview to see whether August was a one-off or the start of a longer slide.

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Sources:

• Cap HPI: Car Market Overview September 2026 (data as of 25 August 2026, published September 2026)