8 car depreciation factors you should know

8 car depreciation factors you should know

Why do some car units have a higher residual resale value while others do not? To answer this, car buyers must understand that there are car depreciation factors that lower the price of used or second hand cars. While the usual wear and tear slashes the car’s price, the items below also contribute to your resale price if you want to sell it.

Age of the car

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Measured by deducting the current date from the date the car was manufactured or assembled. A car that is two generations below the current model will have its price cut drastically. In the Philippines, the average age of most vehicles on the road is between 10 and 15 years old.


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The total distance traveled by the car from the time it came out of the dealer's showroom. This can be seen on the car’s odometer. According to the New York Times, the average mileage of a car today is around 15,000 miles (24,140 kilometers) per year.

General condition

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Pertains to the damages experienced by the vehicle which may include dents, scratches, broken parts and the usual wear and tear. This significantly lowers the car price, especially if the unit was involved in an accident, such as a collision.


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The place where the car is sold also contributes to its price. If there is a demand for the car, it is more likely to have a higher value compared to a unit that is not appealing to local car buyers. In addition, owners who live in flood prone areas usually get a lower resale value for their cars as buyers often suspect that the vehicle may have been flooded in the past.

Availability of spare parts

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The availability of spare parts dictates whether the car can still be repaired or restored. If spare parts are not available, then it will be hard to make the car driveable again. Discontinued car models often suffer this dilemma, especially if other car brands do not market a similar platform where it was based.

Color of the car

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Some car buyers prefer colors that are hard to spot on the road. However, if you want a larger market, stick to standard colors (red, white, grey and black) and stay away from the fads (magenta, brown, etc.).

Upgrades and options

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Refers to added amenities and features that were installed to either improve the car’s performance or comfort. Some examples of these are tire covers, a navigation system, stereo, and LCD screens. Note, however, that some of these options also depreciate in price four or five years after you have added them.


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Ever wonder why SUVs are one of the bestsellers in the country? It is because they can adapt to any climate and road condition in the Philippines whether it be floods during rainy season or dry roads in the summer. Some cars, such as convertibles, have a higher chance of being sold depending on the season. In our other post, we have also evaluated some car models which have the best resale value in the Philippines, as well as their counterparts that have the worst.

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