How much will my car depreciate?
For most people in the UK, their car is their most valuable asset. Buying or leasing a car is a big financial commitment, and it can be hard to predict how your vehicle’s value might change over time.
In the past, there’s been a typical average rate of car depreciation of 10-15% for each year of use, even if year-to-year that rate is not steady. However, since 2021, used car prices have worked differently. Due to factors such as shortages of new cars, and an expansion to local and national emissions policies and targets, certain car segments have held their value much better than in the past. Many cars even experienced periods of increasing value in the last couple of years.
At this point in 2023, if you’re thinking of selling your car in the short or medium term, it’s hard to know where to start. At Motorway, we’ve built an innovative Car Value Tracker so that you can become an expert in how your car’s value changes over time, and choose the perfect time to sell.
Motorway’s Car Value Tracker allows you to visualise changes to up to six cars’ values, for free
Until the 2020s, it’s always been a given that cars lose some of their purchase value as soon as they’re driven off the forecourt. And those in the industry know, the fastest depreciation happens some time in the first 3-5 years, before slowing down a little. Those trends have been bucked in recent years, making it more important than ever to get reliable valuations for your car, rather than following any rule of averages.
What is the Car Value Tracker?
It’s important to stay informed about your car’s value. All cars’ values change dynamically, rather than at a steady rate. So far in the 2020s, many cars have even increased in value for months at a time, due to changes in supply and demand.
Car Value Tracker shows you your car’s changing value, going back as far as two years. It’s easy to see when your car’s value drops slower and quicker, when it holds, and even when it increases. You can track up to six vehicles at the same time to pinpoint the very best time to sell each individual car. And it's free to use!
What affects car value? Depreciation is heavily driven by a common set of factors:
Mileage
Mileage is often seen as a proxy for age and condition. In the UK, typical annual mileage can be between 8,000 and 12,000 miles. Lots of car brands set their warranties to a certain mileage, e.g. 100,000, and PCP finance agreements tend to have mileage caps aligned with monthly repayments, with extra mileage driven chargeable at extra cost.
This is all because, the further a car runs, the more likely it is to suffer wear and tear, to need servicing, and to encounter unfavourable conditions. And all of these factors bring the value of the vehicle down, unless they’re mitigated with careful servicing and maintenance.
A car’s mileage can be assessed in the context of its other characteristics: if it’s a brand or model that’s well known for high reliability and ease of maintenance, then a higher mileage won’t seem as risky to your buyer. If the car is less reputable, then high mileage will almost certainly bring the price down.
Condition
As above, condition, age, and mileage all go hand in hand. When your car is in fantastic condition, with all its service history available, the value will stay strong relative to the age and mileage.
It’s well worth keeping a detailed file of your car’s service history. Having proof that all repairs and servicing have been undertaken by a quality garage may raise your running costs a little, especially after your warranty runs out, but it may end up paying for itself in the value that your car retains.
Especially if your car has had previous owners, it’s worth being diligent about record-keeping during your time owning the car. It’s normal for cars to be bought and sold a few times during their lifetimes, and the more you can vouch for quality maintenance, the more you offset any perceived risk on the part of your buyers.
Brand and model
Some cars simply depreciate faster than others. This is not always aligned with the initial purchase price of the car; there are cars in every price range that hold their value better or worse than their peers.
Generally, if you have a popular model that’s also known for being reliable, and your car is in good condition, you can get a good offer. However, since there will also be a large supply of the same car due to its popularity, there will be some competition out there when you’re selling. This could devalue your car if it’s particularly old, high in mileage, or poor in condition.
Fuel type
Your fuel type will have a major impact on the price your car can fetch, especially in the 2020s. Before emission zones became enforced in several major cities across England and Scotland, fuel type mostly impacted a car’s value in the sense of fuel economy. Smaller and more fuel-efficient cars cost less to run, making them more valuable to buyers. Diesel engines, which achieve more MPG than petrol, were especially understood to suit a lifestyle with medium- and long-distance driving.
These days, however, diesel vehicles and older petrol vehicles are more likely to fail compliance with urban emission zones, and also have to pay more in road tax. Your car’s fuel type and age can have major implications on its running costs, particularly for drivers who visit big cities with charging clean air zones. This may drive the value down.
Thinking of selling your car?
If it’s the right time for you to sell your car, at Motorway we offer a simple – and completely free – method of getting the best price, whatever the model.
Just enter your reg on the homepage and you'll be provided with an instant estimated sale price based on up-to-the-minute market data. We’ll then ask you a few easy questions about your car and guide you through the photos you need to take to complete your vehicle profile. It can be done right from your phone – in a matter of minutes.
If you choose to enter your car into a daily sale, it will be shown to our UK-wide network of verified dealers looking to add to their stock of used cars.
In as little as 24 hours you will receive your best offer – and, if you choose to go ahead with the sale, your car will be collected for free by the dealer and the money will be quickly and securely transferred to your bank account.
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