Used car trade values have fallen by 2.9% in November after a sharp dip in demand, according to price guide firm Cap.

Cap, recently acquired by Solera, said that across the whole market the average value reduction over the past four weeks has been around £300 per car, with a sharper downward dip during week three of the month than at any other time this year.

It means the December edition of CAP’s monthly Black Book will show the biggest single fall since June 2011.

The 2.9% average trade value reduction over the course of November translates to an average price drop of around £300 per vehicle, measured at three years old, with 60,000 miles.

Across different vehicle sectors the average movements range from £124 for city cars, £317 for executive models, £263 for lower medium and £322 for upper medium to £1,840 in the luxury executive sector.

Convertibles may have hit their annual low point with average falls during November of £518 while 4x4s have fared better than most, reducing in value by an average of just £160.

A slowdown in the final quarter of the year is typical in the used car retail and trade sector and Black Book Live notes that this one follows a generally stronger year-to-date performance than last year.

Values up until the end of the third quarter of 2014 had in fact fallen 2% less than over the same period in 2013; however subsequent movements now mean that the overall year has caught up with January-December 2013.

Derren Martin, senior editor of Black Book Live, said: “Despite our warnings as far back as late September that a slowdown would come, the rate at which values have fallen during November seems to have caused some alarm in the market.

“Although this realignment of values is basically a game of catch-up there is no escaping the fact that for users of static monthly trade value guides the Book drop into December is a large one – indeed the highest since the summer of 2011, over 40 months ago.”

Martin said the reasons behind the drop in wholesale prices were down to an increase in supply levels due to an influx of part-exchanges and fleet returns generated by registrations from the September plate-change.

He said the retail demand drop off in the run up to Christmas was also to blame, dealer forecourts are already full so there is no requirement to replenish stocks  and used car prices are high.

Martin said: “Depreciation year-to-date has been less pronounced than it was to this point last year and so prices are generally higher than they were 12 months ago.

“Rather than the market meltdown that some people fear, we believe it is more a case of unusually high prices ultimately proving to be unsustainable.”