7 Tips To Reduce Car Depreciation
Car depreciation is the difference between the amount of money you bought your car for, and what it is worth now. It is one of main costs of car ownership, so reducing it can help you save quite a bit of money – hundreds, and sometimes thousands, of Euros. You can reduce the impact of car depreciation when you are buying a car, and while you own it. Here are our seven top tips.
1. Choose Options Wisely
Lots of options are available when you are buying a new car. Many of them will improve your levels of comfort and driving enjoyment so are highly desirable. Not all are a good idea though, if reducing depreciation is your top priority. To reduce depreciation you should choose options that will add value, like built-in sat-nav or leather interiors.
2. Buy Brands Known For Quality And Reliability
Cars that are known for quality, and brands that are highly desirable, hold their value better than other cars. BMW and MINI falls into this category, as does Hyundai, not least because of the warranties that come with Hyundai cars. If you change your car relatively regularly you will probably be able to sell your Hyundai with a warranty which will increase its value and therefore reduce its rate of depreciation.
You should also think long term when you are buying a new car. Research by the AA has shown that it is usually less costly in the long run to buy an expensive car than a cheaper one. One of the main reasons for this is better rates of depreciation with some high value cars.
3. Choose Colours Wisely
Loud or unusual colours might reflect your personality, but they could also make it harder to sell the car in the future. Buying a car in a popular colour will make it easier to sell, so is the best way to reduce depreciation.
4. Maintain Your Car Well
All of the tips on this list will help you reduce car depreciation, but this is one of the most important. A well-maintained car will always have a higher value than one that is not looked after. To get the highest possible resale value for your car keep the service history up-to-date, and repair any damage as soon as possible.
5. Do Fewer Miles
Mileage is another crucial factor in depreciation rates. The equation is a simple one – high mileage equals high rates of depreciation. Doing as few miles as possible will therefore save you money.
6. Avoid Modifications Associated With Boy Racers
Boy racer-type car modifications will limit the number of potential buyers for your car when you go to sell it. Avoid them to improve your depreciation rate.
7. Sell At The Right Time
Where possible you should time the sale of your car to maximise its value. Some timing factors that can reduce the value you might otherwise get for your car include selling in the wrong season (selling a convertible in the winter, for example), or selling your car right after the manufacturer releases an updated model.
Depreciation is a fact of car ownership, but it is possible to minimise it using these tips.