The price of ULEZ compliant second hand cars in London has more than doubled in some cases due to the enormous demand for vehicles that avoid the £12.50 daily charge when the expanded zone comes into effect this summer. As of August 29 the existing Ultra-Low Emissions Zone (ULEZ) will be expanded to cover almost every inch of London, bringing hundreds of thousands more people into the daily charging area.

Any vehicles that exceed the emissions limit set by Transport for London will activate a £12.50 daily charge for driving anywhere within the ULEZ, and as a result the demand has sky rocketed for used cars and vans that won’t see their owners hit by the fee. Some drivers are being hit by a double whammy where they bought a non-compliant car in the past few years, as they are now worth significantly less for trade-ins.

Lewis Cooper, sales director at Approved Cars Croydon, a used car dealership in Waddon, said ULEZ compliant cars are « going like hot cakes » and his dealership is struggling to get hold of stock. He told MyLondon: « We’ve stopped buying cars that aren’t ULEZ compliant and we’ve got a lot of customers who are wanting to trade in the cars they bought from us a couple of years ago. We can’t give them much. They’ll be getting way under what they paid for it. »

READ MORE: ULEZ cameras covered with bags in South West London in latest act of defiance against expansion

Mr Cooper gave an example of a Ford Fiesta that isn’t ULEZ compliant that was sold for £8,500 two years ago which is now only worth £4,500. On the flip side prices of compliant cars have more than doubled in some cases. Small automatic cars under £5,000 are particularly in demand. He explained: « I bought a used car recently for my mother-in-law. It was a 2008 Mercedes A-Class that a couple of years ago would have been £2,000 at most at auction. We ended up paying £4,500 for it and that’s trade prices. »

A search on AutoTrader reveals the difficulty faced by Londoners looking to find a bargain. The used car platform, which allows people to sell their cars through its website, tallied up how many used cars it had for sale in London under £5,000 that were ULEZ compliant and it found there were 5,150 available in January.

Set against TfL’s estimate that 200,000 people are impacted by the expansion and in need of upgrading their vehicles, that shortage goes some way to explaining the eye-watering price rises. According to AutoTrader the average cost of a used diesel car complying with ULEZ regulations is now £19,991 with the equivalent petrol engine costing £15,000. The average cost of a used electric vehicle is even higher at £36,102. These figures factor in every compliant used car for sale including those that are only a year or two old so pricier cars will skew the figures.

Just 18 cars under £2,000

When MyLondon searched AutoTrader for compliant cars on sale within 25 miles of Central London at 3.40pm on Monday (March 20), the cheapest available was a 2007 Renault Clio for £895 with a mileage of around 101,000. The second cheapest was also a Renault Clio from 2005 with 133,000 miles on the clock, for £1,095. In fact seven of the eight cheapest cars available were Clios. There were just 18 cars available across the entire city and just over the borders that were under £2,000 and ULEZ compliant.

Mayor of London Sadiq Khan’s £110m scrappage scheme was introduced to provide some financial help to Londoners to scrap or retrofit vehicles that don’t meet the emissions requirements. However that’s been described as a « drop in the ocean » when the average price of a used car is nine times that.

Erin Baker, editorial director at Auto Trader, said: « When the average price of a used car is £18,000, a £2,000 scrappage scheme is a drop in the ocean for low-income drivers in outer London who want to avoid ULEZ payments.

« Drivers looking for cheaper ways to beat the tax are also struggling. With the impact of the Covid pandemic likely to keep used car prices high for some time, the lack of affordable options for those on tighter budgets is a real worry in a cost of living crisis. Many of those who can’t use public transport will be put in an impossible position. »

Even without ULEZ, the prices of used cars remain at record levels thanks to the supply chain disruption caused by the Covid-19 pandemic, which AutoTrader says cut the number of new cars produced in the UK last year to the lowest since 1956.

One loophole to paying the ULEZ fee even if your vehicle isn’t compliant is the historic vehicle tax class which allows for vehicles more than 40 years old to get an exemption. Most vehicles that old which are still roadworthy are almost certainly going to be lovingly maintained classic cars.

While they are a labour of love to keep running and potentially pricey to maintain, they are significantly cheaper than the average cost of a compliant car at the point of purchase. You can pick up a 1976 Reliant Scimitar for £5,500 on AutoTrader for £5,500, or a 1980 Porsche 924 for £8,995. Both would be exempt from ULEZ charges.

MyLondon contacted TfL for comment on the scrappage scheme and asked whether there were plans to review the amount offered.

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