Photo by Jinning Li / Shutterstock.com
You should never buy a new car — that is, unless you have money to throw out the window as you drive it off the dealer’s lot. A vehicle’s value generally drops the most in its first year, starting the moment the first owner drives it home.
So, what’s a savvy shopper who wants a like-new car to do? Buy a car that is technically used but no more than a few years old, like an off-lease model.
To get the best bargain, look for a model whose value has depreciated more than the average car in its first few years. A recent iSeeCars.com study identifies some of these models, noting that now is a great time to snag an off-lease vehicle.
CEO Phong Ly, CEO of iSeeCars.com, explains:
“The rising popularity of auto leases in recent years has led to an influx of cars coming off lease, creating the opportunity for consumers to find bargains on late-model vehicles. Consumers who take advantage of these best bargains can purchase a three-year-old car for half the price of what it would cost to buy the same car new.”
For its study, iSeeCars.com analyzed some 4.1 million car sales to determine which cars lost the greatest percentage of their value after their first three years, which is when leased cars hit used-car lots.
The automotive research website found that the average car has depreciated by 35 percent after its first three years. Looking at individual models, however, depreciation can be as high as 52.6 percent over the same time period.
The models that have lost the greatest value after year three — meaning they are the best buys for used-car shoppers looking to avoid depreciation losses — are:
- BMW 5 Series: The average three-year-old model has depreciated by 52.6 percent (to an average cost of $30,846)
- Volkswagen Passat: 50.7 percent ($14,906)
- Mercedes-Benz E-Class: 49.9 percent ($34,010)
- BMW 3 Series: 49.8 percent ($24,024)
- Ford Taurus: 49.7 percent ($18,098)
- Chrysler 200: 48.4 percent ($14,011)
- Volkswagen Jetta: 48.1 percent ($13,157)
- Audi A3: 47.9 percent ($21,120)
- Cadillac SRX: 47.2 percent ($26,291)
- Buick Enclave: 46.8 percent ($26,620)
What has your experience been with used cars — or new-car depreciation, for that matter? Share with us below or over on our Facebook page.