Posted Thursday, August 11, 2022
If you are planning to buy a vehicle, the first thing you wonder about is its price. When purchasing a new car, everything is more or less clear. The model restyling, brand reputation, equipment and dimensions will be significant factors affecting the cost. But what determines the value of a used vehicle, and how it depends on its age?
Obviously, the less the age, the higher the car price. There is no special formula for calculating the cost, but there is a direct relation with the new car market. And if new cars become more expensive, then the market value of used ones rises.
World-renowned engineer Henry Ford said that the best car is a new one. It’s really hard to argue with this statement. A car that has just rolled off the assembly line looks better and breaks less. Such a car may have only one drawback – it costs more. But as soon as it leaves the gates of the dealership, it loses up to 10% of its value. In the first year after the purchase, it will depreciate by 15%, in the second year – by 25%. Read more about how cars lose value.
Spending the same amount, you can buy a used car of a higher class. When buying a car at the age of 3-5 years, you have a good chance of getting a premium-class vehicle with a high trim level in good technical condition. If you decide to buy a used car from 5 to 7 years old, your chances of getting a time-proven vehicle in an attractive configuration are even higher. But so is the possibility of a breakdown, requiring expensive repairs. Finally, you need to balance all the factors.
Of course, a two-three year car with low mileage is the best option. You will find a variety of such models at our car lot in Indianapolis. But if you choose between two similar cars, the lower mileage should be the decisive factor.
The wear of almost all elements depends directly on the mileage, or more precisely, on the operating hours. The higher the mileage, the more expensive the car is to maintain. Therefore, when choosing between a two-year car with a mileage of 100 000 and a five-year car with a mileage of 50 000, think twice. It seems, that all other things being equal, in terms of reliability, you’d better prefer the second one if you know that the car was maintained properly. Because 100 000+ miles for a two-year-old car is a signal of heavy usage.
The car aftermarket is part of a complex economic system. On the one hand, it has the properties of a free market, where the price results from the interaction of supply and demand. On the other hand, the activity and prices in this market depend on the general economic situation in the country, the prices in the new car market, changes in legislation, and other factors affecting the economy as a whole.
However, the most important criteria on which the value of a used car depends are:
Taking into account the above factors, you can roughly understand what cost will be adequate for a particular car.
Or save your time and come to Indy Auto Man, and our experts will help you navigate the market. They will tell you about the most popular models, the shortcomings of each engine and body, and provide a detailed analysis of the average market prices. You can begin with point 6 and make a more informed decision, relying on the expertise of professionals and on the information you have already found yourself. If you want to sell your vehicle first, the easiest way to find out its value is to get our free car estimation online or receive a firm offer for a trade-in value.
Drop by to the Indy Auto Man dealership to kick the tires and buy the car that will bring you years of safe and comfortable driving.