Top reasons for your car to lose value
Thursday 4th May 2023
What is car depreciation?
Car depreciation is simply the difference between a car’s value when you purchase it and when you come to sell or trade it in. This drop in value will depend on the car’s make, model and condition. Depreciation tends to slow down as the vehicle gets older, so it may be worth considering buying a car that is nearly new as it offers better value than purchasing a brand new one.
There are many factors that determine the amount a car will depreciate over time, so whether you are looking to sell your existing vehicle or purchase a new one – it’s not as simple as just looking at the number of years a car has been on the road.
Top reasons for your car to lose value
Condition
Any damage to the car, such as the interior, exterior or bodywork, will reduce its value. We recommend thoroughly inspecting a used car before you consider purchasing it.
Mileage
The more miles you cover, the less your car would be worth. On average, a cars mileage is approximately 10,000 miles per year.
Fuel economy
Petrol engine efficiency is improving however, diesel cars hold their value better than petrol cars. The more miles per gallon, the better for many potential buyers.
Road tax
Fuel draining cars cost more to tax each year which makes them less desirable to potential buyers. It is worth taking into consideration the amount of road tax that is payable.
Number of owners
As a general rule, the fewer owners of a car – the better. We recommend taking a look in the car’s logbook/V5C registration to check the number of previous owners.
Desirability
Some car manufacturers replace models every few years, whilst some go on for 10 years or more. Therefore, the most recent model will hold its value better.
Reliability
A reliable reputation for cars is highly desirable. This is usually based on customer satisfaction surveys.
Size
Bigger, luxury cars are known to depreciate more than smaller cars as they cost more to run. Maintenance will also drive up the higher bills, making it more expensive in general.
Service history
A complete service history is helpful as it is more desirable and valuable to potential buyers. The service book should be correctly stamped to show that the vehicle has been serviced correctly per manufacturer recommendations.
Length of warranty
Most cars have a three year warranty as standard, though some manufacturers are offering even longer. This is a bonus when it comes to selling your car.
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Find out more about what’s included in a car service or locate your nearest Formula One Autocentre to book in for your next service. Alternatively, contact our helpful team to find out more.
