Cars are an essential part of living, and let’s be honest, for most of us they’re the only real toys that we have as adults.
The problem is that from a financial point of view, they’re not the best asset to purchase, since the moment you pick up a new car from the dealership they’re going to lose value fast.
If you’re planning to hold a new car for only a few years, then it’s wise to be aware about the re-sale value of your particular model (which can easily be cross checked with the wonders of the modern internet).
Some cars hold their value better than others, and we’re here to try and help you with the basic facts.
Quick-fire average statistics on how quickly cars lose their value:
- A new car loses 11% of its value the moment you leave the dealership
- During the first 5 years, the car depreciates by between 15-25% per year
- After 5 years, the car is worth just 37% of what you paid for it at the dealership – For a $20,000 car, that’s a drop of $12,600, before you include other costs like insurance and servicing.
We’ve put together a handy graphic below showing you the cars which hold their values best, along with some key factors to keep in mind when you’re a buying a car (used or new):
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