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Car depreciation is an unavoidable part of owning a vehicle. Your car is worth less every year in financial terms. Some lose about 10% of their value in a year and others as much as 40%. A new car depreciates faster than an older car, so it can make sense to buy a used car as it will lose less of its value. There are, however, steps you can take to limit the annual depreciation of your car.

Do Your Research

Before purchasing a car, do some research on the web to determine which cars lose the least value and have the best re-sale value. Certain brands are known for reliability and fuel efficiency and appeal to the public. Although they might initially cost more than less prestigious brands, you should still consider one of these models to limit depreciation. Diesels are becoming more popular because of their better fuel efficiency. For the same reason, a smaller car is often more sought after than a large car with a bigger engine.

The best advice is perhaps not to buy a new car. A one-year-old car is often still under guarantee and has a low mileage. A good five-year-old car is probably the best buy where depreciation is concerned.

Stick to the most popular colours, which are usually metallic red, blue, silver and white. Odd colours might have some appeal because they are unusual, but that is exactly what will make them hard to sell in future. Avoid cars that are best-selling fleet vehicles as they are over-supplied and command a lower price than slightly rarer models. Make sure the car has the most sought-after specifications, such as air conditioning and power steering. Top-of-the-range models should have leather seats rather than cloth ones.


Once you have purchased the car, try to keep the mileage as low as possible by using public transport and not driving unnecessarily. Attend to the maintenance of the car regularly and keep very good records of everything that is done. The full service history will show prospective buyers that you have looked after your vehicle and that it is in good condition. Make sure to keep the outside of the car in a very good condition too. If possible, park it under cover as often as possible.

Try to pay off any loan for a car as soon as possible, so you will save money on interest and get the most from the vehicle without having to still pay for it as it is depreciating in value. Keeping a car for as long as possible means that you get the most value from it.

Daley loves cars and bikes, and enjoys writing about all aspects of motor vehicle care. He works with Southern Grille and Gates to ensure that all vehicle owners have the advice and products they need.