Depreciation – The real challenge

When you want to sell

The moment you want to sell your car, you automatically form a figure in your mind as to the rate that you expect from its sale. But, our experience says that, unless you have immense knowledge about the market supply and demand conditions and other factors involved in valuation, you may not quite succeed in making a qualified estimate. One of the major components of the factors affecting car sales is depreciation.

Let us introduce you to the mechanism of car valuation

Whether you are selling a car or out to buy one, it is always advantageous to be better informed. If you do not know the facts enumerated here, you may end of losing some money unless your dealer is trusted and professional. But not at We do not expect our clients to be whiz kids and be highly informed in all subjects. We do not take advantage of your weaknesses or strengths, because we are professionals to the core. We have been here a long time and expect to serve you for a long time to come.

Factors affecting valuation of cars

Whether buying or selling, a seasoned professional considers the following aspects to evaluate the car that comes up for sale and purchase:

1) Age

  • The vehicle starts aging the moment it leaves the manufacturing facility.

  • It loses 15% of its value within the first 6 months to one year.

  • The cars are reportedly losing 50% of their value within 3 to 4 years.

  • New cars depreciate faster.

  • The current market rate of the cost is compared with the price of a new car to get an idea of the depreciation that the car has suffered.

  • Prestigious brands are able to hold their value depending on individual factors.

2) Mileage

While this question crops up quite often, there is not any fixed parameter or calculation that can be done. In fact, a well maintained vehicle with higher mileage done may be preferred over a younger vehicle not serviced regularly. Experts believe that the rate of depreciation become steeper after that car exceeds 10,000 miles per year.

3) Service

Maintenance of a vehicle is the single most important factor that matters to vehicle owners. In 2012, Honda presented a brand new Honda since the owner of 21 years of a 1990 Honda Accord crossed a million miles. This was due to his meticulous maintenance and timely services. It is always advantageous to a seller if he kept records of services done. However, some experts opine that the average life of a vehicle is near about 150,000 miles or 8 years, if the maintenance and periodical service has been timely.

4) Dimensions

Car users reported that the size of a car does make a difference to the rate of depreciation because of their higher cost and heavier maintenance bills. They generally cost more in comparison to a smaller vehicle. Larger cars are more difficult to sell and fuel-guzzlers become a liability.

5) Condition of interior, exterior

The engine is one of the prime considerations for car owners since it is the most vital component in the running of the car. The aspect of proper maintenance does not apply only to the vehicle and its service schedule. In fact, the looks and presentation does matter in the case of cars too. Whether it is the exterior of the vehicle, the condition of paint and the position of scratches, dents etc or the interior and upholstery, every aspect add to the salability of a car.

6) Brand Reputation

Almost all the customers are stuck to the idea of purchasing their cars keeping in view the brands that are ruling the markets. There are hardly any customers who would just go to a car showroom just to buy any car. In fact, most of the customers’ mind is already made up when they venture out to buy a car. The popularity in terms of performance, power and fuel efficiency are some of the popular considerations.

7) Number of owners

The number of hands that have plied the car does have a bearing on the value of the car to the buyer. It is seen that single-owner driven cars are the first ones to be sold.

8) Car colors

Everyone has their own fancy where colors are concerned. But, the most popular of all the colors is the simple white which is the most well-liked of all.

9) Repairs and modifications

Contrary to popular practices and likes, the value of the car decreases considerably with each touch-up, spoilers, lighting fixtures and provision of alloy wheels. Each addition or modification needs to change something which is tantamount to a repair to the original car.

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How fast does my car depreciate?

Why is it that some models are hugely popular while some are only scratching the surface? It is necessary to know why and how the most popular ones are able to hold their own in the market.

As we learnt from depreciation, we make a comparison between the costs of a new car as against its value at the auctions. In case these rates are less than the market value obtaining, it is an indication that the car will not depreciate in a hurry.

The steep depreciation of some popular cars in the very first year can be misleading. However, the depression just evens out gradually providing you an impressive value that normally exceeds 50% by far. Thus, your choice should pay attention to such features in a car.

Hence, all you have to do is to get in touch with us. If you can spare the time, please call us and we will buy and collect your car and do the paperwork for you.