What Impacts a Car’s Trade-In Value?Apr 22nd, 2022
For many drivers, buying a new vehicle from a dealership is also an opportunity to trade in their old one. But car shoppers often ask: What determines a vehicle’s trade-in value? To help drivers understand what their vehicle could potentially be worth, we’ve broken down all the major factors that go into a trade-in appraisal.
Overall Market Value
The largest factor that will go into determining the value of your trade-in vehicle is its overall worth on the market. Popular models are likely to retain their value at higher rates than less popular models. The vehicle’s configuration can also be important. Specific trim levels, option packages, and even colour can all play a role in determining a vehicle’s worth. Drivers trading in a vehicle with highly sought-after features will be able to get more for their vehicle.
Local Market Value
Even if your trade-in vehicle has plenty of value on average, it’s important to remember that local market conditions can still influence its appraisal. If dealers have too much of a specific vehicle in their inventory, that vehicle’s trade-in value is likely to go down until that inventory starts to clear out.
As many drivers know, a vehicle will depreciate in value as it ages. While depreciation rates can vary by make and model, there are a few rules of thumb that drivers should keep in mind. New vehicles may lose as much as 20% of its value after one year. After five years, the average vehicle loses about 60% of its initial value. As a result, drivers trading in newer vehicles will receive more for their trade than drivers trading in older models.
A vehicle’s condition is another important factor that will determine its overall value. Vehicles that have been well-maintained and feature little to no blemishes will be worth more than vehicles that have noticeable dents or scratches. Appraisers will also take note of the vehicle’s accident history and mileage, as these can be indicators of potential mechanical issues.
In the market for a new or pre-owned vehicle in the Timmins, Ontario area? James Toyota, located at 1234 Riverside Drive, is an excellent place to start your search. We have a comprehensive selection of vehicles for drivers to choose from. Car shoppers can browse our new and pre-owned inventory right here on our website.