Car Depreciation FAQs
How fast do cars depreciate in the UK?
A new car typically sheds 20-30% in year one, ~15% a year in years two and three, then ~10% a year onward. By year three most cars sit around half their list price · which is why depreciation, not fuel or insurance, is the biggest cost of running a newer car.
What is the sweet spot age to buy?
Around 2-3 years old: the first owner absorbed the cliff, manufacturer warranty often remains, and your losses slow to 10-15% a year. Five-plus years old is cheaper again but trades warranty and reliability headroom. This calculator's purchase-age selector shows the difference instantly.
Do electric cars depreciate faster?
Recent years, yes · new-price cuts, fast-improving tech and fleet volumes hitting the used market hammered EV residuals. The gap has been narrowing, and the silver lining is that heavily depreciated used EVs are outstanding value for second owners: the first owner paid for the cliff.
How does mileage affect value?
UK average is 7,000-8,000 miles/year. Excess miles cost roughly an extra 1-2% of value per 5,000 miles per year; low-mileage cars earn premiums. Past 8-10 years old, condition and service history matter as much as the odometer.
Which cars hold value best?
Historically: in-demand SUVs and 4x4s, sports icons (Porsche 911), reliable Japanese brands (Toyota, Lexus, Honda) and supply-constrained models. Fast losers: large luxury saloons and heavily discounted fleet cars, which can shed 60%+ in three years · brilliant used buys, brutal new ones.
For informational purposes only · Depreciation curves are market-typical estimates; individual models vary widely · Check real values on AutoTrader, Motorway or WeBuyAnyCar before decisions · Condition, history, colour and market cycles all move actual prices