COE fell on 23 September. Renewal prices are still set to rise in October.

Category A closed at $131,890 in the second September exercise, down $1,119 from the record of $133,009 set two weeks earlier. For someone buying a new car, that is a small move in the right direction.

For someone renewing a COE, it changes very little. Renewal is priced on a different figure, and that figure is heading the other way.

How renewal is priced

When you renew, you pay the Prevailing Quota Premium for your car's category. The PQP is the moving average of COE results over the previous three months, and LTA updates it monthly.

Because it is an average of three months, it follows the bidding results with a delay. A spike at the auction takes months to work fully into the PQP, and so does a dip.

The current figures for September are $126,208 for Category A and $128,697 for Category B. August's were $125,646 and $127,835.

Why October's figure will be higher

September's PQP is built from the June, July and August exercises. October's drops June and adds September.

July and August sit in both averages, so they make no difference to the change. What moves the number is what leaves and what arrives. In Category A, June included a round at $123,847. September brought $133,009 and $131,890. Swapping rounds in the low to mid $120,000s for rounds in the low $130,000s can only push the average up.

Applying LTA's own method to its published results, October's Category A PQP works out to about $128,715, which is $2,507 above September. Category B works out to about $131,615, up $2,918. The same calculation reproduces September's published figures exactly, so these should land within a dollar or two of what LTA announces at the start of October.

What the difference comes to

A ten year renewal pays the full PQP. A five year renewal pays half.

Who should act this month

If you have already decided to renew and your COE expires in the coming months, renewing in September locks in September's PQP. The price you pay is set by the month you renew in, not by your expiry date. Confirm the timing rules for your vehicle on OneMotoring before paying.

If you have not decided yet, do not renew only to beat the change. Renewing forfeits the PARF rebate permanently, and a saving of a few thousand dollars is not a reason to commit to another five or ten years with a car you might otherwise have replaced. The full comparison is in What happens at the ten year mark, renew, scrap or sell.

If your expiry is well over a year away, this month's change has little bearing on you. The PQP will follow wherever the bidding goes in the meantime, and that cannot be reliably forecast.

The wider point

The bidding results and the renewal price run on different clocks. The auction reacts within a fortnight. The PQP reacts over a quarter.

So when you read a COE headline, ask which clock it applies to. A dip at the auction is good news for new car buyers straight away and for renewals only months later, if the dip lasts. For a renewal decision, the direction of the last three months of results tells you more than the latest round on its own.

Before you decide

1. Check your exact COE expiry date on the vehicle log card.
2. Look up the current PQP for your category on OneMotoring.
3. Decide first whether renewing is right for the car at all, and only then think about timing.
4. If renewing is the right call and expiry is near, compare the September figure against the October one when LTA publishes it.