A thorough understanding of car valuation is essential when attending car auctions or even visiting car sales dealerships. Used car sales can be very difficult to navigate without knowledge about the factors affecting car values. Here, we’ll look at the factors that have an impact on car values.
Depreciation occurs no matter what, as soon as a vehicle is driven off the lot. Within the first year, a vehicle loses about 30% of its value and may have lost 50% by the end of three years. There are a few major factors affecting car values, including geography, climate, upgrades and options, and timing.
Demand for certain body styles is higher in some areas than in others. Vehicles that are popular in a particular area are likely to have higher value in that area. For example, a pick-up truck will have higher value in Dallas than in Miami, and a convertible will be more valued in L.A. than in Madison.
A vehicle’s capability will adjust its value in particular climates. Four- or all-wheel drive vehicles will hold more value in colder regions. You’ll also notice car values of those types of cars increasing in the winter months. The opposite is true of convertibles.
Add-Ons and Options
Certain equipment options add significant value to a vehicle, while other options that may be just as expensive will not. For example, sunroofs, CD changers, and leather seats all add to car values, while equally expensive navigation systems and upgraded stereos do not.
SUVs might hold higher value when gas prices are lower, and even fluctuations in levels of busyness at a dealership can change trade-in allowances. Dealers are far more willing to negotiate on all aspects of purchase when dealerships are less busy.
If you’re looking to do a trade-in, look for a vehicle of the same make. You’re more likely to get a higher value for your trade-in. Once you have your new vehicle, be careful to follow the manufacturer’s recommendations about maintenance in order to increase value down the line when you go to trade-in.
Car values depend on a variety of factors, and it’s important to consider all of them when visiting used car lots. Be sure to do your research and ask questions in order to get the best deal. Visit here for more.