Timing the sale of your used car isn’t like selling stocks. Unlike other large assets in your life (home, retirement fund), your car will always be a depreciating asset.
That being said, you can still mitigate some of the overall depreciation by doing common sense things like:
- keeping your car in good condition
- regular maintenance during the lifetime of the vehicle
- not driving it as regularly (lower mileage = $)
There are other variables that can affect used car price but nothing affects it more than time. The depreciation of a car is often non-linear, meaning it can lose as much value in year one and it does in any other year. This is what is characterized as the “depreciation curve” for cars and no other asset in North America is like it.
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In a previous blog we outlined the depreciation of a new car over a 5 year period:
For example, let’s say you bought a new Mazda CX-5 at ran MSRP of $28,500:
First year depreciation @ industry average rate: $22,800
Year 2 @ 15%: $19,380
Year 3 @ 15%: $16,473
Year 4 @ 15%: $14,002
Year 5 @ 15%: $11,902
At year 5 you can expect that your Mazda CX-5 will be less than half of what it was worth when you first bought it.
This means that you can use the depreciation curve to your advantage. How?
By selling your car before year 5 of the car leaving the dealership lot.
If you're not going to drive your car forever then it might be worth thinking about when the best time is to sell your car to mitigate depreciation. Remember, depreciation becomes steeper after a car is about 5 years old–mechanical issues and warranty are all affected by time and usage.
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Selling before year 5, allows you to somewhat take advantage of the depreciation curve by selling when the car has most of its value and is easier to sell. A ten year old Toyota is far less valuable than one that is five. And as mentioned above, the depreciation cost doesn’t take into account the cost of maintenance which becomes more expensive after the car’s warranty period ends (which is usually around 100,000mi or roughly year five based on a 20k mi per year driving average).
If you have a car that is nearing the five year mark now might be the best time to sell.
The Art of Timing: When Is the Best Time to Sell a Used Car?
When it comes to parting ways with your trusty old vehicle, timing is everything. Many car owners wonder when the best time to sell a used car is, especially with fluctuating used car prices. At Autozen, we understand the importance of getting the most value from your sale. In this article, we'll guide you through the ins and outs of selling a used car and help you determine the optimal time to make that sale.
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Used Car Prices Dropping: A Trend to Consider
Before delving into the specifics of timing, it's essential to understand the broader context of the used car market. Used car prices are subject to fluctuations, influenced by factors such as supply and demand, economic conditions, and seasonal changes. Keeping an eye on the used car price trend will provide valuable insights into when to sell used cars.
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The Best Time of Year to Sell My Used Car
While the best time to sell a used car can vary depending on your location and the make and model of your vehicle, there are some general guidelines to follow:
Spring and Summer: The warmer months, particularly April through June, tend to be the most favorable times to sell a used car. Buyers are more active during this period, thanks to better weather, tax refunds, and vacation plans. It's an ideal time for selling used cars.
End of the Month: If you're looking to get the best deal, consider selling your used car toward the end of the month. Dealerships often have monthly sales targets, and they may be more willing to negotiate to meet their quotas.
Year-End Clearance Sales: Some car buyers eagerly await the year-end clearance sales, hoping to find great deals on new vehicles. To take advantage of this trend, consider selling your used car at the end of the year.
Avoid the Holiday Season: While the holiday season is a time of giving, it's not the best time for selling used car. Many people are focused on holiday expenses, which may reduce the number of potential buyers.
Stay Informed: Keep yourself updated on the used car prices trend in your area. Websites and apps that track car values can be incredibly useful in determining the optimal time to sell your vehicle.
Strategies for Sell My Used Car
To get the best deal, it's not just about the timing; you should also consider other factors:
Prepare Your Car: A well-maintained and clean car will always fetch a better price. Make necessary repairs and give your vehicle a thorough cleaning.
Set the Right Price: Research similar vehicles in your area to determine a competitive price. A fair price will attract more potential buyers.
Online Listings: Utilize online platforms like Autozen to list your used car. These platforms provide extensive exposure to a wide range of car buyers.
Negotiate Wisely: Be prepared to negotiate but also know your bottom line. Don't be afraid to walk away if the deal isn't in your favor.
In conclusion, selling a used car is a strategic procebuyss that involves understanding the used car price trend, choosing the right time, and employing effective selling strategies. By following these guidelines and staying informed, you can maximize the value of your used car sale and find the perfect time to say goodbye to your old vehicle. At Autozen, we're here to help you navigate the journey of sell used cars.
You may also be interested in our articles:
- What most people regret after selling their car
- Factors that affect your car's resale value
- How a crash affects fair cars market value
Thanks, Good Luck to You 🌊
