You’re probably aware of car value depreciation, but you’re probably not sure what you can to protect yourself and maximize your car’s resale value for when the time comes. The value of a car can fall at an alarming rate, and varies significantly across manufacturers and models; but by making yourself aware of the facts, and best ways to protect against depreciation, you can ensure that your car holds the most value possible.
Choose Wisely
It might be basic, but if you have the option it makes sense to go for a car that will hold its value inherently due to its model and manufacturer. In April 2015, the cars that best hold their value are Land Rovers, Maseratis, Audis, Minis, Jeeps, and Mazdas. A car’s depreciation rate can also be affected by a number of other factors beyond the make and model. If you cover more than 10,000 miles per year (roughly average yearly mileage) then the rate of depreciation of your car will increase significantly. Try to choose a model with generally positive customer reviews, particularly those with a good reputation of reliability – a bad reputation can make all the difference. Of course there’s only so much you can do here, but avoid any cars that are notoriously unreliable and you should be fine. The fewer owners before you, the better in depreciation terms – so check the number of previous owners on the car’s logbook or V5C registration. You should also check the service history – the more complete this is, the better – and you should continue to keep a full record while you’re the car’s owner.
Consider Leasing
If you think you’re going to want to change your car after a relatively short period of time, or you’re considering a car or fleet for your business, then leasing can be a great choice to ensure costs remain fixed without leaving you saddled with a depreciating asset – the cost of the depreciation will be covered within your monthly payment. While there’s a small initial outlay, the monthly cost will remain fixed during the period of the lease. This approach can also be much more tax efficient as a small business could potentially claim back 100% of the VAT paid if the vehicle is used solely for business purposes. Check out Car4Leasing for a great range of cars available to lease. They also have a handy guide to depreciation here.
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