RAC Cars

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Reasons for low valuation

There are various reasons as to why you may not get as much money for your car as you would like – some of these are very much under your control, and you can maximise your own efforts in order to gain a significant return. Others are completely out of your hands, involving more luck and timing than anything else.

Demand can greatly affect how much your car is worth, and the need for a certain model can drive the price up by a huge margin. However, if your vehicle is a common model with no particular stand-out features, you may find it hard to get the price you feel you deserve. The strength of certain models depends on anything from the time of the year, to the age of a particular car. Whilst newer cars will generally do better, classic cars can be very sought after. As well as having your car valued, you can improve the price by providing more information about it. If a car has been documented properly (i.e. all servicing, MOTs, accidents etc.), then it should be easy to get a more beneficial price when you have to sell it.

The effects of depreciation

As mentioned, depreciation causes cars to lose value over time. The amount a car will lose over time depends on various factors, and no two cars are affected in the same way. For example, an older car might be worth very little today, but a car released the same year could be worth a lot more because it has features that are now commonplace. Vehicles such as people carriers, jeeps, and luxury cars are all susceptible to losing more money than a hatchback. Even though these types of cars are more expensive, their fuel consumption and repair costs are a lot higher, making them less desirable in the future.

Minimising depreciation

In order to lessen the impact of depreciation on a car, there are a few things you have to make note of.

  • Firstly, when buying a car, it’s a good idea to buy used. The depreciation on new cars is very severe – on average, new cars can lose up to 60% of their value within the first three years of ownership. Even worse, a car will lose a lot of its value as soon as it leaves the dealership.
  • Used cars, on the other hand, have usually already been through most of their depreciation by the time they are bought, and can save the buyer a lot of money. You can also buy ‘nearly new’ cars – vehicles that have been registered underneath a dealer, but have seen little wear and tear.

Colour may seem inconsequential in the scale of car purchase, but buying a popular colour such as black, white or grey is a good way to retain savings. More adventurous colours tend to be penalised when it comes to selling your car on (this is evidenced by the fact these colours are currently 70% of vehicles manufactured globally). You can also look for cars with great features, or even features that are quite advanced – these may be commonplace in a few years’ time.

To get a car valuation visit our value my car tool.