Demand for new registration cars has risen by almost a quarter in the last year despite interest rate hikes, according to new research from AA Personal Loans.

The Deals on Wheels reports also show that motorists have not been put off brand new car purchases in the year ahead. In fact, one in three motorists (33%) say they plan to buy a brand new car in the next 12 months, compared to 26% in the same period last year. Recent reports have suggested that the real cost of cars has actually fallen by 26% in the last ten years, which could be impacting people’s decisions to make an investment in new wheels.

However, the second-hand car market is not seeing the same affects. One in three people (36%) intend to purchase a second-hand car less than three years old in the next 12 months, a 16% decline when compared to the beginning of 2007 (44%).