11 Tips to Maximize Your Car’s Resale Value
Most assets appreciate in value over time, but cars are the only one that drops in value the moment you take it off the lot. Most people believe that fueling your vehicle is the biggest expense to owning a car, but the truth is, it is depreciation. The rate of depreciation varies between makes and models but a car typically loses at least 30% of its value on the first three years of ownership and then drops to 50% of depreciation after the car hits its 3 year mark.
Unfortunately, you can’t avoid it. It’s an inevitability all car owners have to live with. According to US News, several factors affect a car’s depreciation rate.
Factors That Affect Your Depreciation Rate
Fuel Prices – A few years ago when fuel was more expensive, smaller cars had a lower depreciation rate. But now that fuel has become more affordable said types of cars are back in line with most vehicles.
Mileage – Cars also depreciates faster if it has a lot of miles in it. Car owners should try to stay under 13,500 miles each year to keep your resale value high when it’s time to sell or trade the car in.
Brand – Depreciation rate varies from one brand to the other. According to the experts of iseecars.com, “prestige luxury” cars like the Mercedes, Audi, and Lexus tend to hold more value than their non-luxury cousins. However, among the non-luxury brands, the rate of depreciation still differs.
Extra Features – Technology has given us many different features to make a basic car look and feel cooler and advanced. However, these additional features can pull a car’s value down, instead of raising it up. The experts at Black Book explain that a potential buyer is looking at a used car’s value instead of how high tech it is. Some of the features that cause a car’s faster depreciation rate are the supercharged engine, rear entertainment, and sunroof.
Desirability – according to iseecars.com, certain cars simply depreciate less than others, and this includes the Subaru Impreza, Nissan Versa, and Honda CR-V. These cars depreciate by just 3 percent. However, said cars also depreciate at the same rate as the others once they hit their third year.
Car depreciation isn’t very welcome news to car owners, but it also isn’t so bad. If you take on the perspective of a person looking to buy a used car, a vehicle which has lost most of its value likely carries a cheaper price tag. However, if you’re the one selling or trading in a car, you want to keep as much of the vehicle’s value to command the best price.
The Truth about Increasing a Car’s Value
If you’re selling your three-year-old vehicle right now, you can’t expect to get the same price that you paid for it (even if you put in a lot of work to get a great price). However, you can improve a car’s market value so you can sell at the best possible price.
There are several things that you can do to increase your car’s market value. If your vehicle is currently dirty and has a lot of issues, you can’t expect a pretty price. Richard Homan of the Kelly Blue Book says “Unless your car is a rusty bucket of bolts, a professional detailing job is always worth the money. If you don’t want to spend the money for a professional job, be sure that you at least wash and wax your car and change the oil.”
Think Like a Buyer
Try to put yourself in the shoes of a buyer. If the seller tells you that the lights and AC aren’t working and there’s a huge dent at the passenger door, would you even be interestd? And so Homan continues “most used-car buyers don’t want to think about fixing their car.” It would be worth mentioning if you’ve installed new brakes and tires and that the AC is in perfect condition. These statements reduce the mental and financial stress of the buyer should he decide to make the purchase.
Keep it in Good Shape
The best thing you can do before you put a car up for sale or trade is to demonstrate that you’ve been a loving owner to it. You probably already know that there will come a time when you need to give this car up and move on with another even at the time of the purchase, so you must exert all efforts to keeping your vehicle in excellent condition. How you are with the car manifests in the state that it is in. And when the time comes that you need to sell, you naturally want to get as much money out from the sale, and you can only do this by showing the vehicle some TLC from the time of ownership to right before you put it up in the market.
STEPS TO INCREASING A CAR’S RESALE VALUE
There are several ways to increasing a car’s market value so you can claim for a higher asking price come selling time. Don’t forget that most of these things need to begin as soon as you bought the car, so don’t put them off even if selling is far from your mind right now.
1. Observe Proper Maintenance of the Car
If you want to keep most of the car’s value by the time you sell it, you should properly maintain the vehicle from day one. Like most things in life, big things accumulate from small things. Without proper maintenance, you could neglect the signs that your car needs repairs until the problem is way worse (and more expensive). However, with appropriate and regular maintenance, you’ll be able to spot issues early on before things get out of control.
Regular maintenance can include a lot of things like changing your oil, balancing your tires, and replacing your radiator’s coolant. If someone is looking to buy your car and wants a test drive, the issues could pop up and you might lose that sale. At best, you’ll be at a disadvantage to haggle on the price. The potential buyer could use those issues against your asking price.
Whether or not you’re a car expert, it is still best to take the car to regular services with a mechanic. You could point out potential issues during these visits so that the mechanic could check it out and make preventive measures. Additionally, having the car serviced by a professional gives you access to receipts and paperwork to prove that the vehicle was seen, inspected and repaired by a professional – one of your best defenses against customers who might haggle with a lower price.
2. Mind Your Mileage
Most people sell their old cars before buying a new one. If you see yourself selling or trading in the current vehicle in 2 to 3 years to enjoy the experience of a new car, you must already keep mileage in mind.
Driving long-distance across state borders? You might want to re-consider your transportation options. The more miles you put into the car, the faster it depreciates. The Department of Transportation states that the average mileage for a car is at 13,500. If you drive significantly more miles than this, you will lose some of the car’s value and several dollars off its asking price.
But apart from driving long distance, your car could eat up more mileage in a variety of other ways.
For instance, speeding and aggressive driving can put more miles into the vehicle than necessary. Also, you can save more mileage by using cruise control and keeping your speed at 50mph at the freeway. Needless to say, if you mind your driving habits today, you’ll save more of your car’s mileage and increase the car’s sticker price later on.
3. Keep It Clean (Inside & Out)
If you truly loved your car, it will show on the car’s appearance. Buyers share this same sentiment. It’s often easy to judge how an owner handles a vehicle just by looking at its state and condition. If the car looks dirty and interiors smell awful, it’s easy to make the connection.
Keeping the car clean before you sell it is one of the best ways to improve its market value. Clean the car in and out and keep it aesthetically and cosmetically-pleasing at every angle. Fortunately, you don’t even have to spend a lot to achieve a neat-looking vehicle. With some elbow work and the right cleaning products, your car should come out presentable after a few hours of cleaning sessions.
Install rubber floor mats to catch dirt and debris. Give those mats a good shake from time to time. If yours are already worn out and looks ugly, it’s now time buy new ones. You can find a lot of these rubber mats for a low price, but they can do so much in improving the look of your car’s interior.
Also, consider deodorizing the car seat and taking out all the trash and unnecessary accessories. As much as possible, avoid smoking and eating inside the car because cigarette smoke and foul food odors can linger inside the vehicle. Some buyers would know if you do this and can cause for their interests to diminish.
Lastly, remember to use products that are appropriate for cleaning the car. Apart from cleaning the windows wherein you can use a home glass cleaner, the rest of the vehicle should be cleaned with specialty products.
4. Keep it Waxed
A few years ago, your vehicle was once a shiny, cool-looking and vibrant piece of machine. But the paint has faded due to exposure to the elements, use of chemicals and simply because of the natural fading process. You could say that like us humans, your car looks it has aged over the years, and it shows on its skin (or paint).
You might consider having the car professionally- repainted, but that would also mean a significant amount of money out of the pocket. There’s a cheaper alternative though: wax.
Car waxes are products designed to bring out the shine, luster, and color of your car paint. A few layers could quickly make the old car seem like new, all at a relatively cheaper cost. Also, you can wax the car yourself, allowing you to save even more from labor expenses.
Now, you wouldn’t want to wax the car just because you’re selling. Instead, wax it regularly to keep its appeal. Also, avoid using harsh home detergents when cleaning the vehicle as this can be abrasive to the paint and cause fading.
5. Keep Those Headlights Bright
Are your headlights dingy and hazy? If yes, prepare to receive a bad impression. Headlights are particularly essential for safety so you should aim to make them as bright as they can be.
However, some car owners make the mistake of cleaning the car in entirety with an all-purpose cleaning product. The headlights need to be treated separately, and you should use products specially made for them.
However, if the headlights are still looking dull and hazy after a good clean-up, consider having it checked with a mechanic. There’s probably an issue with the alternator or battery, and it’s best to have it fixed now than later.
6. Pick a Sheltered Parking
When your car is out, it is exposed to the elements. Extreme weather conditions can wear out the paint, making the vehicle color look faded. If you like to protect your skin from the harsh sunlight with a wide-brimmed hat, so would your car. Hot weather conditions can fade out the color of your vehicle, while cold weather can cause disruptions to the engine.
Park the car in the garage or covered carport to protect it from the harsh elements. You might consider parking it in the shade, but that won’t be such a good idea though. Bird droppings are acidic and can cause damage to the car paint. Also, you run the risk of a fallen branch making dents and scratches to the car’s exteriors.
7. Keep Up With Maintenance
Like us humans, cars also need to be looked after by experts to ensure optimum performance and function. You don’t want to wait until you spot an issue before you take the vehicle to your dependable mechanic. Instead, you want the mechanic to check out on things even if the car seems like perfectly fine. Some of the issues may not manifest until they become worse and you want to treat these problems right away when they seem minor and trivial.
How often should you take the car to the shop? Just look for the maintenance schedule on the manual and stick to it. Each vehicle is different, and their needs can vary. For instance, some make and model suggest oil change when you reach a certain mileage, while others recommend the use of specific oils.
Also, you need to get the tires properly inflated, both for safety and economy. Unbalanced tires can be a risk on the streets while tires that are properly inflated can help you economize the mileage by 3%.
And while you get the vehicle checked and maintained by a professional, make sure to keep the paperwork. It’s one thing to say to the potential customer that your car is well-maintained, but it’s also another thing if you have the documents to show for it. Also, most buyers are willing to pay your price if they indeed see proper maintenance mostly because it saves them the stress and money for having those issues fixed themselves.
8. Fix Those Dents & Dings
A car is bound to sustain dents, dings, and scratches over the course of its life. Regardless of how careful you are as a car owner, some things can happen beyond your control. However, that doesn’t mean that you should just sell your car as is.
Fortunately, most of these minor issues are easy and cheap to fix. You can hide those scratches with so paint and even polish those scuffs. Also, most dents are easy to correct through expert dent removal companies.
What you don’t want to do is neglect those small things because that could make you become questionable as a car owner. Any cosmetic and mechanical issue needs to be addressed right away, not just because you’re selling the car soon, but because that’s what responsible car owners do.
Also, it’s so much cheaper to fix these minor issues than wait for them to blow out of proportion. A mechanic could spot those flaws in one of your visits and make the necessary preventive and corrective measures. You’ll be able to save yourself from the stress and cost of major repairs later on as well as prevent the premature death of your car’s components.
9. Take Detailed Notes And Keep Your Paperwork
Every buyer would want a lower price, but the seller wants the opposite. If you’re selling your car directly or privately, the potential buyer can question you about maintenance. And while you can enumerate and expound on each of them, you need solid proof that the vehicle is indeed well-kept and maintained.
Take note of every repair and maintenance work performed on your car since the first day you acquired it. You want to keep all service record, warranty, finance contract, manual and stickers. You need to show documentation for every little thing that you did for your car from oil changes to dent repairs to all the big stuff.
Keep all your paperwork in order so you can have something to show to the prospective buyer. Your papers on car history and ownership should be easily reachable during the sale. But most of all, keep all your maintenance records to avoid any awkward questions. The papers will simply speak for themselves. Those documents are the perfect demonstration that you care for your car.
Buyers can cite the lack of maintenance paperwork as a negotiating point, but you can counter that out with the right documentation. Hold on to your papers no matter regardless of whether you’re selling soon or not. It’s just good to know that they’re there when you need them.
10. Inspect, Clean and Replace Tires
Of all the car’s components, the wheels take on the most beating. Wheels keep the car moving forward and are in constant contact with the on-ground elements. Over the years, the wheels could sustain both cosmetic and functional issues that can bring down the car’s total selling value.
If you like to keep the car shiny, you should include the wheels in the game plan. Wheels that look dull and dirty are a reflection of you as a car owner. It’s easy for a potential buyer to assume that you’re probably not such a caring car owner and God knows what other issues this car has.
Keep your wheels shiny particularly before you put the car on the market. Remove dirt and grime and give them a good wipe of tire shine products. Regularly cleaning and polishing the wheels also keep them away from corrosion buildup and ugly stains.
But apart from the wheels’ cosmetic condition, you especially need to ensure that the wheels are in their pink of health. It’s no longer just an issue of aesthetics, but of safety. Wheels in poor health condition can eat more of your gas and mileage than necessary. They also become risks for road accidents.
If you haven’t replaced the wheels at all during the course of your ownership, you must not hesitate now. New wheels may seem costly, but you’ll get a fair ROI by being able to sell the vehicle at a higher price.
11. Drive Safely
Drive safely and respect your car. A buyer with a trained eye can easily spot collision damage even when you try to hide it, and it would be difficult for you to command a better asking price.
Your driving habits can significantly impact the condition of your vehicle. Speeding and aggressive driving will put a toll on your car’s engine and chassis, not to mention put you one step forward towards a potential road accident.
Most buyers would also prefer cars that have never been involved in a collision, so the best thing that you can do is just to keep your cool and drive carefully. Also, vehicles that were never involved in accidents have better prices than those that did.
But if you’ve tried to drive safely as you can, other drivers on the road may not. If you ever get involved in a collision, you need to be mindful of how to carry out the bodywork. Make sure to turn to experts in having the car’s shape and performance restored and opt for Original Equipment Manufacturer or OEM parts for the replacements.
Your car is an asset because it gets you from A to B, but because it depreciates over time, you need to plan ahead. If you put yourself in the shoes of a car buyer, you would want to buy a used car that looks new and well-cared for. You don’t want to deal with every little issue like those dents and scratches and simply drive off a car that looks good and works well.
With this perspective, you should try to meet what the buyer needs from a used car to get the best asking price. You may have to expend effort for the vehicle’s cleaning, repair, and maintenance, but these are all investments in keeping your car with the highest possible value. You may not be able to redeem the original amount you spent for your vehicle when you bought it, but you can keep the price reasonably higher if you cared for the car and you have the proof to show for it.