Saturday, February 23, 2013

Cars That Hold Their Value


What type of car is best for resale?
The Honda and Toyota hold better value than the Dodge
As a continuation of my previous blog post: When Is the Best Time to Sell Your Car?, I want to talk a little bit more about how you can put yourself in the best position to get the most out of your car when it comes time to sell it.

Like a home in a good neighborhood, versus a home in a bad part of town - a good investment up front pays off later.

Buy the Right Car

Not all car makes are created equal. Let's look at this example:

Two people buy cars. One buys a Dodge, one buys a Toyota.

The difference in price on the cars? Maybe 5% (the Dodge costing less).

5 years down the road?

The Dodge is worth 30% less than the Toyota.

Which car would you rather own when it comes time to sell?


Take the Long View

This is just one example of cars that seem similar up front, holding on to their value much differently in the used car market. I'm not saying everyone should drive a Toyota, but it's important to look at these factors when considering buying your next car.

How do you know which cars will hold their value and which ones don't? Well this is the tricky part, as there are  many factors to consider, such as:
  • What model is the car?
  • When will this model be replaced with a new model? 
  • Which trim level of the vehicle holds its value best? 
  • What kind of cars are directly competing for the market of the car you own?
  • Are you buying at the beginning or end of the model cycle?
  • How long do you plan to keep your car? 
  • How many miles do you drive?
  •  Where do you live?
While these questions may make your head spin, a bit of homework up front can mean a big payoff when it comes time to sell your car down the road.

As a car broker, I do this legwork on your behalf and am happy to help you take all these factors into consideration when making your next car purchase.  I work with trade-ins every day and stay up-to-date with both the used and new car markets and am happy to do the nerdy work so you don't have to.

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