It’s well known that Australia’s appetite for cheap Chinese cars continues to grow, but a new report has found that the huge uptick in demand is having a knock-on effect on the used car market as secondhand examples are losing value faster than their competitors as more vehicles become available.

New research from online used-car retailer Carma has revealed that Chinese vehicles priced between $20,000 and $35,000 have fallen in value by 11.1 per cent over the past 12 months, compared with an 8.7 per cent decline for equivalent vehicles from other countries. The findings have been detailed in its Used Car Market Report: Spring Snapshot, which analysed more than 1.8 million used car listings over the 12 months up to September 2026.

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According to the report, private listings of Chinese vehicles, including models from MG, GWM and BYD, have increased by 58 per cent year-on-year, which significantly outpaces the 13 per cent growth recorded across the wider market. That increased supply is reportedly creating opportunities for buyers, particularly those shopping for relatively new vehicles.

For example, Carma found that a two- to three-year-old MG HS was selling for 45.9 per cent less than the driveaway price of a new model and it’s not just Chinese vehicles becoming more affordable, either, as the average used car now 6.5 per cent cheaper than it was in September 2025.

Affordable used EVs gaining ground

Electric vehicles are also becoming increasingly affordable to secondhand buyers, with models priced below $35,000 accounting for 26 per cent of used EV sales in September, which is double their 13 per cent share from just 12 months earlier.

However, depreciation varies between manufacturers. The report has shown that used Tesla vehicles declined in value by an average of 4.0 per cent year-on-year, while electric vehicles from other brands fell by 9.8 per cent, suggesting that buyers could find a bigger bargain by looking at other EV brands.

Used family SUVs becoming cheaper

At the more affordable end of the market, vehicles priced below $20,000 are bouncing back in popularity. Carma found that 62.5 per cent of vehicles listed below that figure in July disappeared from the market within a month, while prices were down 6.9 per cent compared with a year earlier. Popular medium SUVs recorded some of the largest declines, including the Nissan X-Trail (-14.3 per cent) and Subaru Forester (-11.6 per cent).

Meanwhile, buyers considering a near-new vehicle could save an average of $7399, or 14.8 per cent, compared with purchasing new. The Subaru Crosstrek offered particularly strong savings of 19.4 per cent, which is equivalent to almost $8000. At the opposite end of the spectrum, the Toyota LandCruiser Prado continues to show very strong resale values, with 12 month-old examples advertised for just 0.7 per cent, or $667, less than their new car equivalents.

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But despite falling prices, demand for secondhand vehicles remains strong. Around 69,000 used cars left dealer listings in July, making it one of the busiest months for dealers in the past two years. Between July and September, dealer-listed vehicles took an average of 85 days to sell, although some popular models moved considerably faster: the Tesla Model Y averaged just 48 days and the Toyota Aurion 52 days.

Carma CEO Lachlan MacGregor said lower prices were helping bring buyers back into the market.

“Household budgets remain tight, but the used car market has adjusted to meet buyers,” MacGregor said. “Prices haven’t returned to past peaks, but demand is clear. Nearly two in three dealer-listed cars sold in September (64 per cent) had their price reduced before selling, with a typical reduction of about $1,500. The market is clearing at more affordable levels, and well-priced stock moves fast.”

While falling resale values may be unwelcome news for existing owners, Australian used car buyers have more opportunities to secure a bargain than 12 months ago, particularly when shopping for late model Chinese vehicles and affordable electric cars.

Carma’s Used Car Market Report: Spring Snapshot is available to read here.