The value of a car

Get a valuation

If you don’t know the true value of a car, how can you expect to pay the correct amount for it?

Making sure that you get a car valued before you buy it – or sell it – is the key to saving yourself as much money as possible.

Age

When thinking about the value of a car, one of the most primary factors to consider is the age of the car. Depreciation happens as soon as the car is driven off of the forecourt.

By the time the car is a year old, you should expect the value of the car to be down by at least 40%. After three years, the car can be up to 60% off the original sale price.

This rate of depreciation does not continue, however. As the car ages, the age-related depreciation becomes less and less significant. Different models and manufacturers will also vary in the speed at which their cars depreciate.

Mileage

The second most important thing to consider when purchasing a used car is the mileage. You should want to purchase a car that has been carefully used by its previous owner.

On average, a car is expected to go 10,000 miles each year, so this figure is used as the average rate at which cars depreciate.

Following this logic, therefore, if a car is three years old, it should have roughly 30,000 miles on the milometer. If you check the milometer and discover that this is not the case and the number is higher, you know that the price is not fair, as the car will have been more thoroughly used.

If you see a three-year-old car, but it has 40,000 miles on the clock, it should be valued as a four-year-old car, with the appropriate price tag attached.

Engine

Make sure that you check the state of the engine before you part with any money, but don’t expect to make any huge cost savings.

If you check the engine and discover that the spark plugs or radiator hoses need replacing, perhaps reduce the agreed price by one or two hundred pounds.

If you see anything more serious than this, it is wiser to just avoid the car altogether. Any car that needs major engine or mechanical work is best saved for those that have the time and mechanical skills to do it themselves. Anything else can be very costly.

Exterior

Make sure you properly inspect the vehicle for damage before you part with any money. Even if some scratches and dents appear to be nothing more than cosmetic defects, you can usually get the seller to lower the price simply by acknowledging them.

Dents that are around the size of a coin should lower the price by about £50 each – the price to have them repaired. Anything larger should be £100-£150.

Make sure you look at the windows and mirrors of the car for damage too. Any cracks or chips on the windscreen will need fixing immediately, as even the smallest crack or chip can become a lot larger if the car jolts suddenly, or if water freezes in the crack.

In the case of chips and cracks, you should expect to ask for another £100-£150 off the asking price, depending on how large the chips and cracks are.

Interior

In contrast to the exterior, damage to the interior won’t net you as much of a discount. If the air conditioning works, but is a bit smelly, for example, then the system will need recharging by an expert, which can cost between £40-£50. If it doesn’t work at all, expect a bigger discount of at least a couple of hundred pounds.

As for the seats, this is a much more personal issue. It is highly unlikely that a seller will negotiate much on price if the seats are damaged.

Brakes

The brakes can really only be checked during the test drive of your car. If you find that, during this drive, the car does not brake as quickly as it should – or even if they are not working properly in any way – you should give them your full attention.

Whilst replacing brakes is a pretty straightforward procedure that any mechanic will be able to do for you, the real challenge is the cost. The cost will depend on what exactly is wrong with the brakes, whether it is the brake pads or the discs as well. Only an expert will be able to tell the difference.

Replacement pads are relatively cheap, costing around £150. However, if the discs need replacing as well, you should expect a cost of at least £500.

Shock absorbers

Shock absorbers are one of the easiest features to test in your new car. Simply push down on one corner of your vehicle. Ensure that the car bounces just once before it settles back into place. If it bounces more than that, you need new shock absorbers.

Shock absorbers can be quite expensive to replace, but well worth it if you live somewhere will uneven roads. You should expect the cost to be between £200 and £500, including labour.

Tyres

Checking out the tyres is important for your own safety, especially if you’re planning to drive the car away.

The legal lower limit of tread depth for a tyre is 1.6mm, the width of the border of a 20p coin. If the tread is below this, ensure that you have new tyres before you drive the car away, both for your own safety and to ensure that the car is legal to drive.

If the tread is close to being this thin, you can still try and argue with the vendor that they will soon need replacing.

Keep in mind that the average cost for four new tyres, including fitting and alignment, is between £200 and £300.

It all adds up

Make sure that as you inspect the car you are keeping a full tally of the damage and associated costs. They might seem quite small, but they will all quickly add up.

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