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No matter how well you maintain your vehicle, it can still lose some of its resale value with time. There are a few reasons for car depreciation, and many of them are unavoidable. However, there is a trick that people use to save money, which is buying used cars. Use this guide to learn more about why car depreciation happens and how used cars can have a better overall value.

Why Do Cars Depreciate?

Your car may be well-maintained, but it’s only natural for it to see some weakness over time. For instance, the more you use your car and the longer you have it, the higher the chance you’ll have to have something fixed at some point, such as worn down wheel axles or a rusted transmission, which decreases the car’s resale value.

Not to mention, even when buying a brand new car, it will lose value as soon as the next model comes out. Also, your “brand new” car automatically becomes a “used” car once you buy it, reducing the value. It’s hard to sell your car for the same price that you purchased it at when buyers know that it’s lost value and will likely be sold for a better price elsewhere.

Why Do Used Cars Have Better Resale Value? 

used carsCars depreciate gradually in multiple stages. For instance, a vehicle can lower in value after one year, then gradually over the next four years, and then experience a significant price dip after five years. However, if you sell a used car right after the initial depreciation and before the second price drop—which usually happens during the fourth year of ownership—you may be able to sell it to close to what you originally paid for. This is because they’re still relatively new, and most likely have not experienced much of the natural damage that comes from accumulating miles while driving.

When looking to buy a car, opt for one that is in the current model year, but used, or find a used car from the previous model year. For instance, in the year 2020, you’d be looking for a used 2020 or 2019 model. This will ensure that the resell value is as close to the initial price as possible. Many buyers and sellers will purchase a certified pre-owned (CPO) car that has already had its initial depreciation hit since the price is lower, but it's still guaranteed to be a well-functioning vehicle.

 

If you’re looking for a place that sells used cars with excellent resell values, check out Proximity Motor Cars in Burlington, NC. This locally owned and operated business has been selling certified pre-owned cars for over a decade. You can drive off with a thoroughly cleaned and inspected vehicle from a leading car manufacturer for an affordable price. For more information on their services, visit them online or give them a call at (336) 270-6790.

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