Key Takeaways
- A car loses its value due to depreciation
- However, you can make sure it retains its value at the point of sale by scheduling regular maintenance.
- Following some simple maintenance guidelines can help retain your car’s value.
- You should also avoid a few basic errors to ensure the car sale happens at a favorable price.
No one likes depreciation. It whisks away your car’s value almost as soon as you drive it off the lot. While there’s no way to prevent it altogether, there are ways to slow down depreciation. Here are six things to avoid so your ride retains its value for as long as possible.
1. Don’t Skip Maintenance
This is number one for a reason. Skipping oil changes, tune-ups, and other scheduled maintenance will shorten your car’s life and lower its resale value. A well-maintained car is more attractive to potential buyers and commands a higher price. Remember to keep copies of all maintenance records to show potential buyers that you’ve taken good care of the car.
2. Don’t Let the Interior Go
If you eat in your car or have kids who often ride along, the interior will inevitably get messy from time to time. However, try to keep it as clean as possible. A stained or ripped-up interior will make potential buyers think twice about purchasing your car, no matter how well the exterior looks. Make sure to thoroughly clean the interior before putting your car on the market.
3. Don’t Forget About Curb Appeal
Curb appeal is just as important for cars as it is for homes. A scratched or dented exterior will turn away potential buyers before they even take a test drive. If your paint job looks dull, consider getting a new coat before listing your car for sale. Giving your car a good wash and polish can go a long way!
4. Don’t Drive Like a Maniac
We all know people who love showing off their driving skills by speeding down back roads and taking sharp turns without slowing down first—don’t be one of those people! The stunts are dangerous and take a toll on your car over time. Fast driving and hard braking can cause premature wear and tear on your engine, tires, brakes, and suspension system, lowering your car’s resale value.
5. Don’t Modify Your Car
While adding aftermarket features may be tempting, resist the urge! Modifications almost always decrease a car’s resale value because they make it less attractive to potential buyers outside your niche interest group. In some cases, modifications may even void your warranty, costing you big bucks down the road.
6. Don’t Neglect Serious Repairs
If something breaks down in your car, get it fixed—simple as that! Neglecting necessary repairs will make your ride less enjoyable and decrease its resale value by signaling to potential buyers that you haven’t taken good care of the car.
How Depreciation Works
To put it simply, depreciation is the decrease in the value of an asset over time. Everything depreciates, including cars, houses, and appliances. When you buy a car, it’s only worth what someone is willing to pay for it. The second you drive your car off the lot, it loses value. A new car can lose as much as 20% of its value in the first year alone. And over time, that loss only accelerates.
There are several reasons why cars lose value as soon as they are driven off the lot. The main reason has got to do with supply and demand. Cars are mass-produced, so there is an overabundance of them, which drives down the price. On the other hand, there is always a demand for new cars, so dealers can charge a premium for them. In addition, cars also depreciate because they are subject to wear and tear. Every time you drive your car, it goes through a tiny bit of wear and tear. Over time, the wear and tear significantly reduce the value of your car.
How to Calculate Depreciation
There are different methods for calculating depreciation, but the two most common are the straight-line method and the declining balance method. The straight-line method subtracts the salvage value (the estimated value of the car at the end of its useful life) from the car’s price and divides it by the number of years in the car’s useful life. The declining balance method bases depreciation on a percentage of the original purchase price; typically, this percentage is double the straight-line rate.
Also, Read – Signs Your Car’s Radiator is Failing
Car Maintenance Measures that Help Retain its Value
How do you ensure you get top dollar when it comes time to sell? Here are a few car maintenance measures that help retain its value.
Change the Oil Regularly
One of the best things you can do for your car is to change the oil regularly. Most mechanics will tell you that you need an oil change every 5,000 miles. Some cars may be able to go longer, but err on the side of caution and get it done sooner rather than later. Not only will this help your car run better, but it also helps maintain its value.
Get Regular Tune-Ups
Tune-ups are essential because they help keep your car running smoothly and efficiently. By getting regular tune-ups, you can avoid bigger (and more expensive) problems down the road. Again, this helps with both the performance of your car and its resale value.
Wash and Wax Regularly
Regularly washing and waxing your car helps protect the paint job and keeps it looking shiny and new. When it comes time to sell, a well-maintained exterior will help fetch a higher price. So break out the hose (or take it through a drive-through car wash) once a week and give it a good scrubbing. Then break out the wax and give it a good shine. Your car will thank you for it!
By following straightforward vehicle maintenance and car service guidelines, you can retain your car’s value and avoid costly repairs down the road. Feldman CDJR of Clarkston, serving West Bloomfield, MI, is here to help you keep your car running like new with our expert service team.
Schedule a visit today, and let us take care of everything for you.
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