Used car prices dropped by 1.8% in May, following three months of steady price increases, according to research by dealer advertising platform MOTORS.

This came as as dealer inventories reached their highest level all year, with the average dealer now stocking 52 used vehicles.

Tesla Model 3s were worst hit, with values for three to four-year-old models dropping by 3.3% in a month, with the used EV market having already seen consistent decline since October 2024.

Lower prices resulted in higher sales, with franchise dealers seeing 11% higher month-on-month sales, with independents and car supermarkets seeing 6% and 4% higher sales respectively.

Despite higher sales numbers, the average vehicle is now in stock for 30 days, compared with 29 in April.

Independent dealers saw the slowest sales, with the average vehicle now being in stock for 47 days, while car supermarkets typically sold a car in 21 days.

Lucy Tugby, marketing director at MOTORS, said: “Following two successive months of price rises it was just a matter of time before we started to see some downward pressure, especially as dealer inventories have been growing since March.”

Younger cars were fastest to sell, with Vauxhall Corsas aged between six months and a year old selling in just nine days, on average.

For the third month in a row, used EVs have been priced lower than their hybrid counterparts.

Tugby added: “As greater numbers of EVs enter the used car market, especially from the leasing and fleet sectors, we’re starting to see lower prices attracting higher levels of online views as they become affordable considerations for more in-market buyers.

“Falling EV prices will give dealers greater confidence to stock them, especially as the overall average is now lower than hybrids.”