Cars vary widely in resale value. A typical car will lose 60 percent of its value over the first four years of its life. You can’t control all the factors that will affect how well your vehicle holds its value, of course, but choosing wisely will help you maximize your chances of getting a decent price when you sell it or trade it in for a new one.
What are the factors that influence resale price?
Vehicle history and mechanical condition are probably the most important factors. Vehicles still under the manufacturer’s warranty command a higher price. And those that have been driven fewer than 10,000 miles per year will also fetch a premium.
If you have a long commute to work or live in a rural area, you can’t avoid piling on the miles. But you can make sure your warranty is in good standing by following the manufacturer’s maintenance schedule and making sure any problems that crop up are serviced promptly.
Appearances count too, so keep your car clean, inside and out. You should, at a minimum:
- wash, wax and vacuum regularly
- touch up scratches quickly
- clean and protect upholstery and dashboard
- clean up spills promptly
What else can you do to maximize your car’s resale value?
It helps to choose a car that’s popular among buyers. For example, you many want to choose an automatic transmission, since automatics outsell standards in general. Less than 20 percent of cars on the U.S. market have standard transmissions. But it’s the specific attributes of a particular make or model that make it popular, of course. Reliability, in particular, is important and will pay off in lower repair bills. Handling performance, fuel consumption and comfort features are also key considerations for purchasers. Today you can get information such as vehicle history reports and recall, reliability and safety data for specific makes and models on the Internet.
In terms of options, some extras will fetch more dollars at resale time, while others won’t:
- air conditioning, cruise control and power windows are popular options in resale cars
- rear defoggers, tilt steering wheels and power locks boost resale value more in trucks than cars, because they are still considered luxury features for most trucks
- larger, more powerful engines typically add more value to pickups and SUVs than to passenger cars
- in-car navigation systems usually don’t hold their value, which can be up to $1,000 to $3,000 new
- color doesn’t affect resale value much, though black and white are perennially popular
Other variables that can affect resale value include regional preferences, based on typical use, terrain and climate; time of year; economic conditions; local supply; and new vehicle production. You can’t do much to change these factors, but you can make the best of them. Do a bit of research into local preferences before buying, try to sell at the optimum time of year – typically spring through fall – and hold onto your car if the local economy is sluggish due to layoffs or seasonal employment patterns.