How To Minimise Your Car’s Depreciation And what It is
A very detailed article has been Witten in “We Buy Any Car’s” magazine (or blog), titled How does Depreciation Work? Written by Daniel Travis Brown it goes on to list the various things that will affect the value of your vehicle when it is time to sell it and how minimise its affect.
But it starts by explaining, what depreciation is in the first place. The answer is obvious as it is the difference between how much the vehicle cost in the first place and how much you would expect to get when you choose to sell it. This difference is deemed as depreciation and it values from make to make and model to model, normally depending on supply and demand of the model in question.
For example, larger luxurious vehicles or 4x4s, are likely to lose more money over the period that say smaller run arounds.
How Many Miles Have You Driven Over Period of Ownership?
The other variations start with overall mileage of the vehicle from buying to selling. Of course, a vehicle that has driven under the average mileage is likely not to drop as much depreciation, where higher mileages have been driven a greater loss will occur.
Extra damage beyond normal use for the vehicle average age is also likely to reduce value further.
So how well has the vehicle been maintained during ownership and where was it serviced and did it occur at the correct intervals. Any deviation to the recommended times may affect resale value.
Changed Opinion Over time
There have been times in history where the popularity of a vehicle has changed in a small amount of time. The Suez crisis in the 1970s, drove a demand for small cars, with big engine petrol guzzlers, losing value by the day. In contract, the 1980s saw a return of fast and luxurious cars, in the boom years.
Recently in the UK, diesel engine vehicles have received some very bad press regarding what comes out of the exhaust and some have lost more value than would normally be expected due to tariffs and bad press.
The Volkswagen group had a emission scandal in recent years also on their diesel engines, where official figures could no longer be trusted. This also affected their sister companies, such as Audi, Seat and Skoda.
The We Buy Any Car Article, goes on to explain further how to minimise this depreciation
Do Your Homework
The first piece of advice is to do your homework before buying any car and figure out what kind of depreciation you are likely to get with your chosen model.
Then consider how you drive during this time. Sensible driving can prolong the life and condition over the period.
Keeping it clean and ideally waxed, will prevent dirt engraining the vehicle. Where it is parked at night, for example under a tree on the drive on a dirty road or safely within a garage, can also maintain the look of your car.
The final piece of advice is to avoid modifying the vehicle. Personalising a car will reduce its demand and the new buyer will occur the costs, of taking it back to original specification.