Buying a new car is an exhilarating experience, wouldn’t you agree? In fact, it probably ties with the excitement of investing in your first house. What most dealers won’t tell you, however, is that a majority of cars dramatically depreciate when you drive them off the lot by a whopping 20%. This means if you were to purchase a car for $40,000, it would be worth about $8,000 less as soon as you hit the road for the first time!
Why should this information concern you? Well, if you plan to finance your vehicle yourself, do a trade-in or, unfortunately, happen to get into an accident and require insurance to restore the car to its original condition, you need to be aware of your car’s depreciation value.
In this article, we explore 23 vehicles that retain their value the longest. We also touch upon how knowing the new car invoice price in Canada helps you get the best cars at the most affordable rates.
Everything You Need to Know About How Cars Depreciate
A question you no doubt have is, What should I know before buying a new car? You should familiarize yourself with the vehicle’s expected depreciation rate over the duration of you owning it. After the first 3 years, the average vehicle will be worth half its current worth.
Apart from the car losing about 20% of its value when taken off the lot, an American auto comparison site reveals that new cars also devalue by about 23.5% after one year and by a whopping 60% after the first 5 years! This depreciation percentage eventually whittles down after a certain duration.
There are specific factors that impact the way your car loses value over time. These are as follows;
- The reputation of the manufacturer and the model
- The year it was manufactured
- The number of miles you’ve clocked up
- The condition of your vehicle
- The service history of the vehicle
- The colour of the vehicle
- Market conditions such as newer models produced by that same manufacturer or the economy at large
Fastest Depreciating Cars 2019
Another burning question is; Which car loses its value the fastest? These are some of the fastest depreciating cars in 2019;
- Nissan Leaf – depreciates by 71.7% after 5 years of ownership
- Chevrolet Volt – depreciates by 71.2% after 5 years of ownership
- BMW 7 Series – depreciates by 71.1% after 5 years of ownership
- Mercedes-Benz E-Class – depreciates by 67.2% after 5 years of ownership
- Jaguar XJL – depreciates by 66.4% after 5 years of ownership
- Chevrolet Impala – depreciates by 66.2% after 5 years of ownership
- Chrysler 200 – depreciates by 48.4% after 5 years of ownership
- Cadillac SRX – depreciates by 47.2% after 5 years of ownership
Slowest Depreciating Cars 2019
Which car has the best resale value in Canada? The Canadian Black Book published its Best Retained Value Awards recently and shortlisted these promising cars that give the buyer the best ROI and depreciate the slowest. The frontrunners in each category are as follows;
- Toyota Yaris (Sub-compact Car)
- Toyota Prius v (Compact Car)
- Toyota Camry (Mid-size Car)
- Toyota Avalon (Full-size Car)
- Lexus CT200h (Entry Luxury Car)
- Audi A7 (Luxury Car)
- Porsche Panamera (Premium Luxury Car)
- Chevrolet Corvette (Premium Sports Car)
- Ford Mustang (Sports Car)
- Toyota Tacoma (Small Pickup)
- Toyota Tundra (Full-size Pickup)
- Toyota Sienna (Minivan)
- Mercedes-Benz Sprinter 2500 (Full-size Van)
- Chevrolet City Express (Compact Commercial Van)
- Jeep Wrangler (Compact Crossover/SUV)
- Toyota 4Runner (Mid-size Crossover/SUV)
- Chevrolet Tahoe (Full-size Crossover/SUV)
- Porsche Macan (Compact Luxury Crossover/SUV)
- Lexus GX460 (Mid-size Luxury Crossover/SUV)
- Mercedes-Benz G-Class (Full-size Luxury Crossover/SUV)
- Mercedes-Benz GLA-Class (Sub-Compact Luxury Crossover)
- Jeep Renegade (Sub-Compact Crossover)
- BMW i3 (Zero Emission)
Slowest Depreciating Brands 2019
Just as they do by model, cars also depreciate by brand! What brand of car has the best resale value? According to the 2019 Best Resale Value Awards, these brands have displayed a lower than usual depreciation rate for their cars based on the manufacturer alone;
Best Brand: Toyota
Best Luxury Brand: Porsche
A question we simply have to answer at this juncture is; What sedan has the best resale value? According to the 2019 Best Resale Value Awards, these sedans and coupes depreciate the slowest;
Which SUVs hold their value the best? According to the 2019 Best Resale Value Awards, these SUVs and crossovers depreciate the slowest, making them a viable investment;
Yes, It’s True, Cars Also Depreciate Based on Colour!
As surprising as it may seem, automotive car colours are a phenomenon in and of themselves. In fact, automakers spend a lot of time trying to predict what colours will make a big splash with consumers.
The colour of the vehicle does hold monetary value and influences the residual worth of the car itself. Simply put, an in-demand colour today is likely to make your vehicle all the more popular say, 5 years from now. Thus, colour cleary sways the depreciation rate more than one might assume.
What color car has the best resale value?
As a general rule of thumb, neutral colours fare better than chromatic tones like yellow, orange or pink. In North America, these three car colours are your safest bet and won’t put you at a disadvantage when selling your car later on.
Got Your Eye on One of These Cars?
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