This marks the highest rate of growth since November 2022, and the third consecutive month the rate of growth has increased, rising from 2.7% in April, and two per cent in March.
Despite recording a positive growth, average used car prices are being impacted by the ongoing contraction in used electric vehicle values, which as of mid-May are down 17.3% on the same period last year while since January average prices have fallen circa £4,600.
In contrast, the average price of a used petrol (£16,365) and diesel (£16,556) is currently up six per cent and 4.3% respectively against May 2022.
Richard Walker, Auto Trader's data and insights director, said: "Over the last few months we've seen an acceleration in retail price growth, from both a year-on-year and month-on-month perspective. This not only shows the current strength of the used car market, but also how important it is to keep a close eye on live retail prices to drive the most profit out of every sale. With trade values not in line with retail, this further strengthening in retail prices is providing robust margin potential."