It is not unknown that cars lose value from the moment they are driven out of the showroom. Depreciation is a phenomenon that every car undergoes and is a number that varies with an array of factors ranging from age to maintenance of the vehicle. On an average however, cars are believed to lose about 60% of their value over a period of 3 years that boils down to 20% on an annual basis. Typically, the rate of depreciation reduces with age but is largely dependent on the make and model of the vehicle. Whether you intend to buy a used car or are simply looking to limit value loss of your car on account of depreciation, here are a few pointers how you can do it.
1. Good Maintenance
One of the best ways of minimizing depreciation of your vehicle is keeping it in good health. This loosely translates into ensuring that your car is looked after on a regular basis. It is essential that a car is serviced according to prescribed company timelines and repairs are undertaken without undue delay. A fully accountable dealer service history commands much more value than you think. Maintaining the exterior of the vehicle is just as important in creating indemnity against loss of value. The existence of scars, dents and worn off paint is sure to pull down the value of your vehicle irrespective of how well the vehicle has been serviced and taken care of.
2. Go for a Used Car
A marvel strategy, usually adopted by many dealerships is to pick out cars that are barely a year old. Being relatively new, these cars lose their highest rate and a good amount of depreciation within a year of purchase and usually come with fully serviced records. It is quite improbable that the car would have travelled a large distance within such a short span of time and therefore, qualifies as one of the best strategies in reducing the rate of depreciation of a vehicle. With the limited disadvantage of not driving away in a brand new car, you can sure get yourself a deal like none other.
3. Keep it simple
Simplicity is often the best way to go and cars are no exception to this rule. Technology is fast growing and in as far as automobiles are concerned, the more classic and simple the vehicle, the better the price it commands. Accessorising your car with state-of-the-art technology does not guarantee indemnity against loss of value. You may have bought a car two years back and installed an advanced navigation system – an accessory that cost you a good amount of money. Today however, most vehicles come with an in-built navigation system causing you to lose out on your rather expensive investment. Therefore, installing advanced music systems, trays and holders and even painting your car with an unusual colour may not help in protecting your asset against depreciation.