Car Depreciation Explained
When a car loses value, this is called depreciation. The more a vehicle depreciates, the lower the portion of its original value you will get back when you sell your car.
As soon as a brand-new vehicle is sold, it will start declining in value. The rate of depreciation slows as the car ages, with vehicles potentially losing half of their value in the first three years of their life, which is the reason why many buyers opt for used cars.
What Factors Affect the Rate of Depreciation?
In addition to how old the vehicle is, there are several factors which can influence how quickly a car depreciates. This includes the following:
The higher the mileage and the more use a vehicle has had, the less it will be worth.
Makes, models, trims and colours which are highly desired or rare will better retain their value because buyers will be willing to pay more for them.
Cars with a full and healthy service history are more likely to attract consumers, so good maintenance will have a positive effect on resale value.
Low running costs are a priority for many car buyers, so cars with good economy will depreciate slower. With the introduction of tax benefits for greener vehicles, low CO2 emissions can also make a car hold value better.
Wear and Tear
Every vehicle is sure to suffer a bit of wear and tear over the years, but scuffed upholstery, paintwork scratches and small dents will still lower the vehicle’s value, and obviously serious damage which will require costly repair work will lead to a more significant drop in its worth.
It is best to avoid vehicle modifications if possible, as they may not be to everyone’s taste, which can make the vehicle more difficult to sell.
To find out how much your vehicle is currently worth, get a free no obligation valuation with Kent Car Buyer today!