Purchasing a used or second-hand car is one of the most exceptional and smart decisions anyone can make; these cars have already fallen through the depreciation stage and have several miles on their utility.
However, purchasing a second-hand car has some susceptibilities, like its state of operation, papers, to understand whether the vehicle has been in an accident before or stolen, etc.
Multiple factors determine the price of a second-hand car. Whether it can be a buy or sell of a used car, understanding these aspects is essential to knowing the decent market price.
Following is a list of some essential points to consider before buying a used car in India to minimise the risk and smooth the process.
The 10 Most Crucial Factors That May Affect Second-Hand Vehicle Value
As the best car finance company, we are trying to show aspects that are affecting the value of a second-hand car:
1. Age of Car
The price of a car diminishes with time and its usage. Aspects include car models, variants, supply and demand, and price. The older a car, the more you need to spend on maintaining and repairing its parts, and the less its value will be.
2. Auto Model and Its Making
Whereas few automobiles experience fast depreciation, others face it slowly. Depending on its durability, a car can be targeted for the multiple checks it challenges on the used market. Even among vehicles from the same manufacturer, some are stronger than others. Another advantage that is seen when valuing old cars is their high fuel economy. This is because the cost of gas is high, and thus, efficient automobiles are necessary.
3. Mileage of Car
Car mileage represents the distance that the car has travelled, as reflected on the odometer. The fewer miles or kilometres a car drives, the higher its economic value. Lower mileage reveals that the car has suffered less wear and tear. Higher-mileage cars, on the other hand, may necessitate additional maintenance and repairs.
Used-car buyers and sellers must note that mileage is not the only factor deciding a car's price. A car with scratches, dents, and damaged internal parts will be cheaper than one in perfect condition, even if it has lower mileage.
4. Car's Service History
Routine maintenance reduces a car's worth. Manufacturers suggest servicing the car every 12 months or after every 12000 miles. Most purchasers are curious about how frequently the car was serviced before the sale. As a result, they may want to see your car's maintenance record to measure its past and present condition. Always keep your car's service records available to be safe when selling.
5. Car Body Style
Only some designs are always more attractive to buyers of second-hand cars than others. Recently, the tastes and selections of people purchasing used cars have transformed. People purchase second-hand SUVs to adjust their families, for their safety, and for commercial purposes. Meanwhile, old models and cars with known design flaws fetch a lower price.
6. Accident History of Car
As part of the car valuation process, other recon amounts are various accident histories. Tires, engines, gearboxes, and mechanical parts of automobiles devalue when spoilt. When a used car is delivered for repair, it is found that its value is lower by 10% even if it is repaired. Therefore, if you want to sell your car in the future, you must be watchful about how you drive.
Read Also: Benefits of Choosing a Second-Hand Car Loan Over New Car Financing
7. Exterior Features of the Car
Any modification to the exterior of the car affects its economic value. Such changes include car paint, backside wings, and an upgrade to the body kit. However, if the car has scratches or damage or lacks appropriate maintenance, its value will be depreciated in the market.
8. Internal Features of the Car
The valuation of the car also relies on its inside conditions. Accordingly, check the internal conditions before listing the car for sale. Items like worn-out seats and filthy interiors will diminish the car's value. On the other hand, proper care of the car and installing recent technologies, such as boosting the sound system, repairing brakes, and installing reverse cameras, among other parts, will boost the car's valuation.
9. Acquisition Frequency
Frequency of ownership evaluates the number of car owners and how often the car changes hands. If the vehicle has more owners, it lowers its resale value. Every time a car changes hands, it undergoes more wear and tear. Additionally, it is unbelievable to endure routine maintenance.
10. Mileage of the Car
Using the car less slows down its frequent depreciation. Usually, the automobile loses 20% of its worth for every 20,000 miles driven. However, if the vehicle has a high mileage, it can also be less valued when it comes time to sell it compared with a low mileage.
Hence, it is highly suggested that you sell the car before it has accumulated 60,000 miles. Also, there would not be any issue if your vehicle is just around five years old. People do not want to purchase a car with multiple maintenance and repair issues.
Why Choose Used Cars Instead of New Cars?
New car prices are constantly rising, making it difficult for everyone to purchase a new car. Also, new advanced car models are gradually being introduced into the used car market, and capable buyers can buy the premium model at a similar price. Moreover, used cars typically depreciate at a slower rate than new cars. You can also get lower dealership fees and insurance costs.
Conclusion
Several aspects, such as the car model, colour, mileage, etc., impact the price of a used car. If you buy or sell a second-hand car, you must know these aspects to make a better financial decision. Before purchasing a used car, research and select it based on its interior and exterior conditions. You can get a used car loan from Car Pe Cash for funding.
Car Pe Cash is an affordable car loan interest-rate company. We offer the best car refinance loan to lower your monthly instalments. Our advantages include flexible repayment tenure, high loan amounts, and affordable interest rates. Why wait? Apply now!
FAQs:
1. What factors determine the value of a used car?
Many factors affect the value of a used car, including its age, condition, number of kilometers driven, service history, brand, and market needs.
2. How does a car brand influence its used car value?
Yes, some of the brands, such as Toyota or Honda, arising from reliability are usually some of the best brands in the used car market.
3. Why is service history important for a used car's value?
A detailed service history at least gives the buyer confidence and increases the car's resale value.
4. What relationship does the age or year of manufacture have with the value of used cars?
For recycling, the market price of old cars is comparatively lower than that of new cars. In general, the latest models with modern innovations and increased levels of safety are endowed with better-retained value.