Second-hand LandCruiser buyers ‘go completely nuts’ during COVID delays

If you spend much time perusing second-hand vehicle sites, you’ve probably noticed an explosion in pricing, particularly for LandCruisers.

It’s a reversal of the long-held rule of thumb that vehicles lose 20 per cent of their value in the first year, and 10 per cent thereafter.

The bizarre situation is yet another symptom of COVID disruptions, which is affecting both vehicle manufacturing and shipping.

Valuer and former director of Auctioneers and Valuers Association of Australia Simon Cotter said some new vehicles had waiting lists months long.

“It’s a supply issue, it takes about nine months to get a dual cab 79 series GXL,” he said.

“They’re $86,000 recommended retail and you will see them in the Toyota dealerships second-hand for up to $105,000, and people are paying that money, and they’re paying that money because they don’t want to wait.”

Mr Cotter said LandCruisers had experienced the biggest jump in value because of their reputation for reliability in an uncertain time.

“They have this reputation of reliability and consistency, so you’re buying a dealer network and you’re buying that folklore, that legend if you like,” he said.

“The factory turbo diesels just fetch drug [big] money, because that motor is a particularly good motor and you will see a million kilometres out of those engines if their oil is changed regularly.”

Bidding frenzy

Mr Cotter has personally been on the end of the bidding frenzy for LandCruisers.

“I had a GXL 200 series for three years. I paid $92,000 for it, did 70,000 kilometres in it, and sold it for $88,000, and probably today I would make money on it,” he said.

“Then I bought a dual cab GXL 79 series with a bit of gear, I paid $86,000, I was offered $95,000 by a Toyota dealer.”

Mr Cotter said there was a huge demand for the vehicles from the farming and mining communities, but buyers from other markets had shown increased interest.

“One other thing driving prices is the recreational market. There are lots of people sitting around, twiddling their thumbs because of COVID, and they’re building their escape vehicle,” he said.

“A lot of these vehicles have a lot of optional extras and they go completely nuts. They put coil spring rear ends in and all sorts of things.

“In a traditional sense you would expect depreciation on those products, but they’re getting their money back if they sell, so you’re talking up to $160,000, $170,000.”

Second-hand prices rise across the board

Mr Cotter said it wasn’t just second-hand LandCruisers experiencing a rise in value.

“It’s occurring in other areas as well, graders, loaders, etc. There has been probably an increase in values of maybe 10 per cent, because you can’t buy them for immediate delivery,” he said.

“It is something that’s occurring across the spectrum, but not as strongly as with the LandCruisers. If other products have increased by 10 per cent, we’re talking 20 per cent or more with the LandCruisers.

“You can ask [for] more than retail [prices] in the used [market] and people who are desperate to buy one today will pay it.”