What is your car worth? How to calculate the value of your car
If you’re a South African motorist who is interested in selling your car, you would want to know how much your car is worth. Calculating the value of your car is not just guesswork, but a scientific process. Read on to see how various factors can influence your vehicle’s value. 1
Calculating the value of your car
In previous years, it was a challenge to find out the actual value of a used car since there was little access to online information. Nowadays, you can easily find out your vehicle’s value, making it harder to discover bargain deals.1
What can affect your car’s value?
When you work out your vehicle’s value, you need to include details like service history and even details such as spare keys. You may think that the latter to be irrelevant, but just to replace a set of car keys could cost you in the region of R5000. 1
Information is king
Making an informed decision is really important when buying a car. If you have done your research, you’ll have more chance of finding a great deal. Other details to consider before purchasing a car are the car’s popularity, whether a bank is providing finance and the car’s age. 1
How popular is the car?
Compared to more popular cars, those that are not sought after, will depreciate more as they get older. On the other hand, a recent and popular model that isn’t widely available, could be worth more. The price of a car rises when the demand is high. However, if a dealer has several vehicles in stock, of the same make and model, which aren’t selling easily, he may offer less on any similar new ones arriving at the dealership. 1
What other features influence a car’s value?
Extra features on a car can add to it’s overall value. Again, it’s all about demand: what is available at a dealership and in the marketplace. For example, a vehicle may have an extra feature such as a sunroof, which is in high demand. If that’s the case, the offer may be higher compared to that of a standard car without that feature. 1
The car’s colour
Don’t underestimate the importance of a car’s colour. Black cars are not as popular because you can see scratches easily. This is not the case with white or silver, and so those cars tend to be more highly valued. 1
The effect of depreciation
It is well-known that new cars can depreciate by 15-25% within the first year. The more expensive a new car is, the more you stand to lose. But an older car can increase in value as it ages, depending on how in demand it may be. 1
What about the car’s age?
Vehicle age certainly has a significant influence on a car’s price. The buyer must also consider the vehicle’s value in terms of mileage, extra features, supply and demand, and it’s overall condition. 1
The importance of a warranty
The influence of a warranty on a car’s price depends on the vehicle’s popularity. If it is highly prized, and still has a warranty, you can sell it for a higher price. Conversely, a less popular car without a warranty will sell for less. 1
Disclaimer
The above article is meant to give general information to help you understand the different characteristics of car insurance and how your car is valued for sale or purchase.
Are you considering buying a new or used car? Regardless of how much your next car may cost, you still need to protect it with good car insurance before driving it out of the showroom. Contact PMD and learn more about their excellent customer service and affordable car insurance products with unique benefits like fixed premiums* and a reduce-to-zero excess*. T’s and C’s apply.
As with all financial services products, first consult a certified financial advisor to make sure the product is right for you.
Source:
1https://businesstech.co.za/news/motoring/295138/how-to-determine-the-value-of-your-car/
This article was prepared by Eric Sandmann in his personal capacity. The views and opinions expressed in this article are the author’s own. The views and opinions in the article should not be attributed to anyone but the author unless expressly stated. Nothing in this article should be relied upon as advice, this publication is presented for informational purposes only. No person should act or refrain from acting in reliance on any information found in this article, without first obtaining proper financial advice from the appropriate professional. The author makes no claims, promises or guarantees about the accuracy, or completeness, of any information linked from, referred to, or contained in this article. The author reserves the right, to edit and change the content of this article.
