With the new year in full-swing, South Africans are settling into new positions, new jobs, or new cities, while others are gearing up for university or school runs, meaning new commutes and possibly new cars.
When these lifestyle changes happen, not every South African can afford to buy a brand new car, meaning that they have to look towards the pre-owned market for reliable transport.
WesBank advised prospective buyers to look at what is going on in both the new and used vehicle markets, as these two sectors do not operate exclusively from one another.
As such, new car prices and new vehicle sales numbers have a direct impact on the price and availability of pre-owned vehicles.
Lebogang Gaoaketse, Head of Marketing and Communications at WesBank, explains, “When new car sales grow, as they did dramatically in 2025, it creates a ripple effect that can positively affect the used vehicle market.”
More new car purchases lead to an increase in trade-ins, which, in turn, leads to an increase in the used car supply and lower prices.
WesBank noted that consumers are keeping their vehicles for longer, six to eight years on average, which has an effect on the availability of low-mileage, well-maintained cars in popular segments.
The finance house also explained that body type trends affect the value of used vehicles, as SUVs and crossovers make up over 50% of the local passenger vehicle market.
Three-year-old compact SUVs sell more easily, and often fetch a premium over similarly aged sedans with comparable mileage and condition.
According to WesBank, vehicles that fall into the three-to-five-year age range remain the sweet spot for pre-owned value, commanding 44.25% of the market in 2024.
This age range represents the point where cars have seen their prices depreciate significantly while still offering buyers modern features, and remaining warranty coverage after clocking manageable mileage.
When buying a new or used vehicle, WesBank says shoppers need to understand that what determines a vehicle’s price entails much more than just what the dealership wants to charge for it.
The prime interest rate has dropped from 11.75% in September 2024 to 10.25%, while vehicle inflation also dropped to a record low of 1.5% last year, the lowest it has been since 2008.
As a result, TransUnion data shows that used-to-new vehicle financing ratios reached 1.56:1 in the final quarter of 2024.
This marks an increase from 1.23:1 in the previous year, indicating that used vehicle sales are on the up.
Further data shows that half of all used vehicle purchases in South Africa are being financed, at an average price of R396,000.
According to WesBank, all of these factors combined mean that if buyers plan carefully and budget responsibly, now could be a good time to enter the used car market.
Looking ahead
Gaoaketse explained that financing options have evolved, and more flexible financing terms and tailored products are curated to meet the needs of different buyer profiles.
“A favourable interest rate means little if the monthly payment strains your budget,” he noted.
“Total cost of ownership, including insurance, maintenance, fuel, and potential repairs, needs to sit comfortably within your means.”
“Financing provides access, but financial discipline ensures sustainability.”
Several factors look to be shaping the market so soon into the year, as stabilising interest rates look likely to support increased financing activity.
Naamsa predicts a 9 to 11% growth for new vehicle sales in 2026, which could lead to more trade-ins later in the year, increasing the availability of pre-owned stock.
WesBank reports that approximately 36% of prospective buyers are showing a preference for hybrids, while interest in electric vehicles continues to grow.
More new energy vehicles entering the market will have an influence on used vehicle availability, pre-owned pricing trends, and will impact buyer decision-making.
At the end of the day, buyers who prepare and practice patience could take advantage of the used car market and benefit from lower premiums.
WesBank explains that the opportunity exists for graduates buying a first car, a family upgrading for growing needs, or a working person seeking a reliable commuter.
The finance house encouraged car buyers to do their research, budget accordingly, and know what they are buying before even stepping onto the dealership floor.
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