When buying a new auto, diminished value (known as depreciation) is a valid concern. Depreciation occurs naturally over time, and additional problems such as auto accidents can also cause your car to lose a lot of its original value. You can get an auto value appraisal at any time to determine exactly how much your car is worth, but getting someone to actually appraise your car will cost you. If you want to estimate your car's value without paying for a car value appraisal, you can get a fairly good estimate by following these tips.
Tip 1: Check Kelley Blue Book
Kelley Blue Book (kbb.com) is considered the number one resource for car prices across the country, both new and used. Especially for used cars, the fair market value is determined by what is posted on KBB. You can use KBB as a resource to look up your car's year, make and model and get a market value. This value will assume that your car is in excellent condition: no accidents, no repairs needed, no scratches in the paint—nothing that would detract from the value of any used car. KBB makes a great starting point, but unless your used car is impeccable, you will likely need to subtract from this starting value.
Tip 2: Use a History Report
If you are purchasing someone else's used car, you will want to run a vehicle history report to see if the vehicle has been involved in any accidents and how many owners it has had. If you are estimating your own car's value before selling it, you don't need to run the history check, but you should still know how these factors affect your car's value.
If your car has been involved in an accident, it can instantly lose up to 18% of its original value even if it was repaired. This is a maximum, and your car's actual value reduction will depend on the amount of damage sustained and the repairs performed.
Cars which have only had 1 previous owner are more desirable than cars which have been owned by multiple people, but there isn't a specific depreciation amount per owner. Just be aware that if your car has had 2 or more owners, it is likely worth a little bit less than a 1 owner car would have been.
Tip 3: Check the Condition
It stands to reason that the better condition a vehicle is in, the more it will be worth. If your vehicle is in perfect condition, it may be very close to the Kelley Blue Book fair market value for a used car in excellent condition. If it has scratches or chips, or if any repairs are needed, you can estimate that it will be worth less the cost of the repairs or detailing.
Following these 3 tips can help you estimate the value of either a used vehicle you wish to sell or a used vehicle you are thinking of buying. By taking these factors into account, you can make sure you're asking or paying a fair price for a used car.