Just like us humans, cars or any types of vehicle have different significant milestones that can affect their performance and value. The lifespan of a car may be measured primarily by what the odometer displays, but mileage alone cannot tell you when the best time to sell your car is. So, how do you know when it’s time to let it go?
In this article, we look closely at the different factors that depreciate your car’s value and give you an idea of the right time to sell or trade your car in the pre-owned market so you can still get the amount you are expecting. Read on!
Are you still paying for it?
Many car owners bought their vehicles through a loan plan from a bank. If you are still paying for it on a monthly basis, then find out if you owe more than the actual value of your car- which is a common case for many. Selling your car at this stage will likely result in a heavy financial hit as you still have to pay the loan.
While refinancing your loan may be an option, the best solution is to hold on to the car until you pay it in full, which is between three and five years after you have bought it. Pay your monthly diligence promptly- remember; a financed car is still not yours and could be taken away by the bank should you fail to make the payments.
Has it reached its warranty?
When you buy a brand new car, manufacturers put a warranty period of 3 years or 100,000 kilometers, whichever comes first. Why is this important? If your car is out of the warranty period, your manufacturer is not obliged to fix your car, even if it turns out to be a lemon. Hitting this mark will greatly decrease the value of the car.
But then again, if you have financed your car, even reaching the warranty period will leave you with fewer reasons to sell your car immediately to prevent rapid depreciation. Proper maintenance for the remaining two years after warranty has expired is the most practical solution if you want it to be in good condition and sell it after the financing period.
Does it still need repairs?
Some car sellers forgot your car’s potential new owner wants a perfectly running car and not the accessories attached to it. That means they don’t want to repair their newly purchased car in the next year or two. Thus, if you want to sell your car, make sure it is in perfectly good condition otherwise, you may find it difficult to sell as price depreciation (through wear and tear) is bringing its value down further.
The solution? Have your car fixed, especially its engine and electrical equipment. While you may be spending an extra amount, at the very least you will have a better chance of selling it. And remember that you are selling your car not to gain profit, but to cut your liabilities. After all, a badly maintained car has poor mileage (costs you more on gas) and is vulnerable to expensive repairs.
Are you now spending more on gas?
As cars age, their fuel efficiency and performance significantly decreases. You need to consider if you are paying more for gas today than two or three years ago. While you may blame the seemingly constant rise on the price of oil, your car may actually be a culprit. Also, as technology progresses, more fuel efficient cars are being introduced onto the market. If your car’s fuel economy is worse than current car models, then it is time to start considering changing your car.
Will manufacturers still produce this car model?
Be up-to-date on recent automotive news, especially on how a car model line is doing. If the manufacturer has considered pulling out your car model in the local market, chances are there will be fewer spare parts available unless they are going to introduce a new car model under the same platform. If the car model is at the end of its cycle, better sell your car as its value will significantly drop.
Best Time to Sell Your Car
If your answers to the above questions are mostly NO, then selling your car will get you more money than if your answers are mostly yes. However, there are other situations to consider- especially the fluctuating market. Selling your car early can still mean some depreciation. Leaving it out too late, and its reliability could be in question. The best time to sell your vehicle is when you can get more by selling it rather than keeping it.
Remember: These are Just Tips
The beautiful thing about the used car market is that while these basic considerations are good guidelines to follow, they certainly aren’t rules about how it’s done. Honestly, that perfect buyer could come from anywhere, at any time, regardless of other factors. Selling your used car at a good value just takes your time and effort. Put those in, and it’s very likely you’ll walk – or drive – away satisfied.