Understanding the Value of a Used Car – Cincinnati, OH
Sometimes it can seem like the value of a used car is just a fanciful number, plucked from the ether and slapped on a vehicle by mystical forces beyond our comprehension. Fortunately, that is not the case – in fact there are some very clear guidelines used to determine used car values, which are important to understand. Once you know how the price of a used car is determined, then you can have a better sense of what to expect with a trade-in, a reasonable asking price if you want to sell your vehicle, and how much you might pay at a dealership.
One thing to keep in mind is this: when it comes to the value of a used car, there is always going to be some wiggle room. There is no perfect formula that will come up with the right number for every car under the sun. Used vehicles are just that: used. How much use and how much care an owner takes with a vehicle has a tremendous impact on used car values.
But, the more you understand, the easier it will be to know where prices are coming from when you look at things like Edmunds or Kelley Blue Book to see what a used vehicle is worth. Just remember that what something is worth is not always what someone is willing to pay for it.
The Make and Model
The manufacturer and individual model of a vehicle have a huge impact when determining used car values. After all, these two factors have a major influence on the original price when a vehicle was brand new, so it makes sense that it would play a big part in the used price. This also holds true when looking at whether a vehicle is a car, SUV, or pickup truck – as these different types of vehicles can have very different prices.
So when you are trying to get a sense of what different used car values might be, start off by looking at the make, or manufacturer, and model of a vehicle. You cannot simply look at whether something is a car or truck since two different cars and two different trucks can have very different values. For example, Chevy makes both the Malibu and the Corvette – but the prices of these vehicles are vastly different.
Model Year for a Vehicle
Model year also plays a huge role in determining used car values, and understanding what the model year means is very important. There is one important rule, with one important exception, to keep in mind here: newer used cars are usually more expensive than older ones. A used car from just two years ago might be valued quite a bit higher than a used car from seven or eight years ago. The more recently a car was first sold, the less wear and tear there will usually be on a vehicle – especially its mechanical and electrical systems that naturally take a lot of abuse over time.
The major exception to this rule, however, is for classic cars or vehicles of particular years that are noteworthy for one reason or another. Classic vehicles from decades ago can, naturally, sell for more than recent used vehicles – especially to collectors who are interested in particularly rare vehicles. Of course, vehicle condition is very important here – a 30-year old car with almost no original parts in need of a lot of repairs is not going to be as valuable as a classic with all its original components that has barely been driven.
Also of note are certain years that mark new generations or had particular improvements over other years. Buyers might be more interested in a model year that is the first for a certain generation and it could have more value. On the other hand, a first year in a generation could have been plagued by issues worked out in subsequent years, diminishing its value.
Trim Level and Other Options
Of course, the actual make and model, and year it was released, are only the starting factors when looking at used car values. Just as important – perhaps more important in some cases – is the trim level and options or features of a vehicle. The starting trim on a new car might be several thousand dollars less expensive than the highest trim level – perhaps tens of thousands in some extreme situations. That means two cars that are the same year and model can be worth very different amounts based on their trims.
Also of importance are factors such as available options that were not directly tied to a particular trim level. If one vehicle has leather seats, safety features that were optional, and an improved sound system with better speakers than another, then that car is likely to be worth more on the used market. All of these kinds of details have to be considered when looking at possible used car values and coming up with what a vehicle is worth. If a model was upgraded to a more powerful engine or has all-wheel drive instead of front-wheel drive, then these features also make it more valuable.
Arguably the most important factor when looking at used car values, however, is the actual condition of that vehicle. This has nothing to do with the year it was made, the manufacturer and model, or the features and trim level – and everything to do with the person who owned it. Two identical vehicles, with the same trim and features, can be worth completely different amounts if one of them was babied by a driver who only took it out on weekends, and the other was driven seven hours a day, six days a week.
Also of consideration when looking at the condition of a vehicle is the kind of action it has seen – which is to say, has it been in a collision? Any collision is likely to decrease the value of a vehicle when it is resold, but some can be more devastating than others. A minor fender-bender that is repaired at a dealership by manufacturer-certified service people might have very little impact on the value. On the other hand, a serious crash that was repaired by the owner’s friend is a major unknown factor and likely to decrease the value of that vehicle.
Different Used Car Values
When all is said and done, as you look at used car values on a website, you will probably see a few different numbers. It is very important to understand what each of these means, so you know what you should realistically expect for your vehicle. You will usually see a “trade-in price” or “wholesale price” listed; this is the price a dealership might be willing to pay for a vehicle, and is usually the lowest listed value.
By comparison, a “retail price” is what a dealership is likely to sell that vehicle for, and is usually the highest value. After all, dealerships need to make a profit on the vehicles they sell, including used ones. You could also see a “private seller price” listed, which is what you might expect to be able to sell your used vehicle for to another person rather than a dealership. Using this as your asking price is not a bad idea – just remember that a buyer will probably try to haggle with you.
Now that you understand how used car values are determined, you are better prepared to sell, trade-in, or buy a pre-owned vehicle. At McCluskey Automotive, we are happy to help you with all your used-vehicle needs. Come in today and see our incredible selection of high-quality used vehicles at the best price around, guaranteed!