The variables that affect a car’s worth in Canada must be understood if you intend to sell one; otherwise, you risk being taken advantage of without being aware of it. In this article, we’ll outline all the variables you should take into account when determining your car’s value so you can avoid that.
The Market
If you’re trading in your car, you won’t receive market value but the offer should be close to it. This is normal because dealership needs to spend money reconditioning the car ready for resale.
If you sell your car privately, you will get closer to market value as the new owner won’t need to check and recondition the car. But you’ll have the hassle of ads, queries, inspections and test drives.
If you sell your car to a dealership, you’ll get close to market value similar to trade ins. Again, this is because the dealership has to recondition the car and spend money preparing it for resale.
The offer should be close to market value though as we always try to pay fairly!
Age & Depreciation
Your car’s age will most likely have the greatest impact on its value. This is because they are a type of asset known as a depreciating asset, cars lose value over time. This is due to two factors. First, since cars aren’t made to last forever, they rust and gradually deteriorate with time. However, the more significant factor is that as technology advances and newer automobiles have more gadgets and gizmos, cars very quickly become out of date.
There are online calculators you can use to figure out the exact rate of depreciation that’s happened to your car which is based on factors including the car’s age, make, model, and sometimes even where it was produced.
Condition
The state of the car is the next most important element that determines the value of a car. We can all agree that there is a curve, and if you turn up to buy a car and discover the front bumper is hanging loose and one of the doors is missing, you’d be rather angry if you were then expected to pay full price. However, no used car can be expected to be in pristine brand new condition.
There isn’t an exact science to figuring out the effect of problems and damages to a car’s value, however a good starting point is subtracting the cost of repairs from the current speculated value.
Modifications
Unfortunately, if you’re interested upgrades, aftermarket modifications can have a shockingly substantial negative impact on the value of your automobile. Both because modifications greatly depend on personal preference and because they are much more expensive to replace when they malfunction than factory components. It’s typically advised that if you’re planning to modify your car, you save the original parts and reinstall them before selling because you can encounter problems doing so.
Emotions
Even though it is the least scientific of all the aspects that affect a car’s value, it can occasionally have the most impact. Although it is impossible to prove that someone loves someone, if a buyer happens to feel the same way about your car, that might increase its value far more than any of the other factors could. Because of this, you should ensure that the seller is investing more than simply money when you sell.
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