It’s tough to get away from vehicle depreciation. In the first year of ownership, most vehicles depreciate around 20%. That means that if the average car in Canada costs $50,000, you could be losing up to $10,000 in the first 12 months alone. Here are some easy ways to reduce the pain of depreciation:
1. Choose a popular make and model
Depreciation is closely tied to how popular a vehicle is, so it’s a smart idea to consider models that are consistently among the top-selling vehicles in Canada. The more people who want to buy the vehicle you’d like to sell, the more it’ll be worth.
2. Pick a common colour
You may fall in love with that lime green car, but that may not be the case for everyone. Overly bold colours can be a tougher sell, which means it could cost you money when it’s time to sell.
3. Buy a pre-owned car
Let someone else pay the depreciation! Since brand new vehicles depreciate around 30% in the first year, if you buy a year-old vehicle that means the previous owner paid the price for you.
4. Keep maintenance records
When selling a pre-owned vehicle, it’s reasonable that the purchaser will want to make sure all the service and maintenance has been kept up with before they buy. If you have records of all the service you’ve done, you have a better chance of retaining your car’s value.
5. Consider an extended warranty
Most extended warranties are transferrable at no cost. Think of it as selling your vehicle with pre-paid repair coverage.
6. Add protection treatments
Paint sealant, rust protection, and fabric/leather protection are all fantastic examples of treatments you can add on to make sure the vehicle looks brand new for as long as possible. The nicer a vehicle looks, the more people will pay for it!
7. Try to keep your mileage reasonable
As a general rule, the average car will rack up 20,000 km per year. Any higher than will negatively impact your vehicle’s resale value. If your intention is to keep your car’s resale value as high as possible, then consider other transportation options from time to time to keep the number on the odometer low.
8. Sell at the right time
Choosing the right time to sell a vehicle can help get you the highest price. If you’re selling a convertible, there’s increased demand in the summer, whereas if you’re selling a truck, it’ll be in high demand in the winter.
