Are you thinking of selling or trading in your car? Here are some tips from dealers that will help increase your car’s resale value.
An important factor in safeguarding your car’s future worth in the used-car market is to think about its resale value at the time of purchase. This means buying the right car model that will sell in the future rather than an obscure make.
Dealerships will determine a car’s value by assessing a range of factors including the make and model, odometer, overall condition, car specifications and maintenance history.
Buying the right model
Choosing an obscure brand or model won’t help in adding value to your car in the used car market. The best-selling car models will have a higher resale value compared to niche car models.
The most popular passenger cars are the Toyota Corolla and Toyota Camry which are frequently in the most sold second-hand cars every month. They were the fastest-selling cars in the used car market with a sell time of 30 to 35 days.
The top two used car models in February this year were utes: the Ford Ranger and Toyota HiLux. Both of these models had an average sell time of 44 days.
Popular SUVs such as the Toyota Rav4 and the Mazda CX-5 and were sold within 35 to 41 days.
Australian automotive intelligence firm Autograb’s monthly data revealed that passenger and SUVs are the most popular models of car in the second-hand market by volume.
Before deciding on what car you’ll purchase it’s best to research trends on the used car market and determine which models have been the most popular. Other factors you should consider include petrol or diesel cars and manual or automatic transmissions.
Colour
Specific car colours will fetch a higher price compared to bright or limited-edition colours. US-based coating company Axalta released a report that revealed that white, black and grey (including silver) were the most popular car colours worldwide.
In Australia, 38 per cent of new cars sold are white which is why they tend to sell for a higher price, and have a faster sell time, compared to red or green.
Geographic demands
The area where a car is being sold will impact demand and the demographics. A dealer will try to have stock that will cater to their location to fulfil customer preferences better.
For example, customers living in warmer climates like the northern parts of Australia will prefer cars with lighter paint and interiors as they won’t get as hot under the sun compared to cars with dark paint and dark interiors.
Timing
Autograb data revealed that resale value declines sharply after the five-year mark. Selling your car before the five-year mark, and when it’s still under warranty is a smart move as it gives potential sellers peace of mind. Nowadays it’s easier to sell a car with a warranty remaining as many car brands offer long warranties.
As an example, the Toyota Yaris, one of the most popular hatchbacks in Australia, retains 107.4 per cent of its value on average when it’s between two and four years old. This means that oftentimes it has a higher value used compared to when it’s purchased new. However, this value will decrease to 91.5 per cent when the car is between five and seven years old.
Odometer
While many deals don’t want cars over five years old, it can also be said about cars with more than 100,000km on the odometer. When the car’s odometer exceeds 100,000 km, the value of your car will decrease significantly.
Buyers who live in the city favour cars with a lower mileage compared to buyers living in rural areas, who tend to drive more kilometres.
Aftermarket options
While it may be attractive to add aftermarket wheels or a bull bar to increase the value of a car, it usually doesn’t as it can make selling harder.
There are some modifications that could add value to your car which include having a head unit with Apple CarPlay and Android Auto, as it brings the car in line with modern technology.
Repairs and servicing
Dealers will offer less to cars that are damaged and worn as they will have to spend to repair any issues and get the car in a sellable condition.
It’s best to check with a dealer before getting any repairs fixed as they can get it fixed cheaper than the average consumer.
Regular servicing and maintenance of service records also increase your resale value. Keeping the car’s original documents and service logbooks from a certified service centre or mechanic will help prevent the resale value from decreasing.
Additionally, holding on to the original accessories and all the keys that came with the car will help to increase the resale value.
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