How Does Car Depreciation Work?

Car depreciation means the loss of value your vehicle experiences over time. The moment you drive a new car off the dealership lot, it starts losing its resale value. Typically, cars lose about 20% of their value within the first year. After the initial steep drop, vehicles continue to depreciate at roughly 15% each year thereafter.

Why Use a Car Depreciation Calculator?

Whether you're considering buying a new vehicle or planning to sell your current car, understanding how quickly your car loses its value is crucial. Our easy-to-use car depreciation calculator helps you estimate how much your vehicle will be worth in the coming years. This is especially handy when comparing the long-term value of various cars or planning future resale or trade-in.

Factors That Affect Car Depreciation Rates

• Make and Model: Luxury and premium brands often depreciate faster initially but might retain more value later.
• Mileage: The more miles driven, the faster a car's value decreases.
• Condition: Regular maintenance and repairs can significantly reduce depreciation rates.
• Market Trends: Popularity, fuel efficiency, and technological advancements can either speed up or slow down depreciation.

Estimating Car Depreciation With Our Calculator

Simply enter your car’s original purchase price and the number of years you've owned it. Our calculator instantly provides a clear estimate of your car’s current value, along with the total depreciation loss. With accurate estimates, you can plan smarter financial moves, whether that's deciding the right time to sell or picking your next vehicle with better resale potential.

Additional fields for mileage let you gauge how heavy driving affects your car's value. If you rack up more than about 12,000 miles per year, depreciation accelerates. Experiment with the mileage inputs to see how keeping your annual driving in check can preserve resale value.