Why is there a big difference between purchase price and valuations?
I am currently looking to purchase a small automatic petrol powered car with low insurance for my daughter, however whenever I go into the insurance comparison websites I am discovering that there is a huge discrepancy between what the vehicles are being sold at and what value the websites are stating the vehicle is actually worth.
For example a VW Polo automatic is advertised at £3500 but the website says it’s only valued at £870 and another advertised at £4000 but valued at £1000. The issue comes if the purchased vehicle is involved in a collision she could potentially lose a substantial amount of money. It doesn’t seem to matter if it’s private or trade selling the cars. Do you have any suggestions on how to get such a vehicle at a reasonable price without being ripped off?
For example a VW Polo automatic is advertised at £3500 but the website says it’s only valued at £870 and another advertised at £4000 but valued at £1000. The issue comes if the purchased vehicle is involved in a collision she could potentially lose a substantial amount of money. It doesn’t seem to matter if it’s private or trade selling the cars. Do you have any suggestions on how to get such a vehicle at a reasonable price without being ripped off?
Asked on 2 April 2024 by Michael Donaldson
Answered by
David Ross
For any vehicle there is a difference between the price you can expect to pay as a buyer, whether that is a private sale or from a dealer, and what you can expect to receive as a seller, especially if this is in part exchange or to a car buying website. The valuation provided by an insurer is intended to reflect what it would cost to replace the vehicle, the idea being that in the event of the vehicle being written off that a similar replacement can be purchased.
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