MOST of the UK’s largest motor finance brokers expect new car registrations will slip into neutral over the course of 2016, according to the latest Paragon Car Finance Headlight Survey.

While car buyer confidence remains high – unchanged at 7.1 out of a possible 10 – compared with the previous survey, almost three-quarters of brokers (72%) feel that a levelling off in new car sales is on the cards.

In Paragon’s latest quarterly survey of the UK’s top 30 vehicle finance brokers, one quarter (24%) of brokers surveyed continue to see scope for a further increase in sales in 2016, with only a small minority (4%) expecting registrations to drop.

For those optimistic for further gains on 2015, low interest rates (80%), continued economic growth (60%) and manufacturer support (60%) are highlighted as the most important factors supporting sales.

Meanwhile, brokers say the biggest potential threat to buoyancy comes from the possibility of an interest rate rise (52%), alongside the risk of an over-supply of new cars into the UK market (29%).

Julian Rance, head of Paragon Car Finance, said: “After several years of strong growth, the broker community is clearly expecting to see a gradual cooling off in the rate of new car sales growth.

“Encouragingly, car buyer confidence remains high and with expectations that UK interest rates will now stay lower for longer, we should continue to see healthy levels of activity across the new and used car market in the UK for the foreseeable future.”