Conventional wisdom says that when a car buyer drives a new car off a dealer lot, it immediately loses a quarter of its value. There is some truth to that. Used car prices, even for those just a year old, drop sharply from the same models bought new. However, used car prices have risen in the past year. While there is no single reason for that, cars are built better than two decades ago, they last longer and bargain-hunting buyers can save money.
Another reason for high used car prices is supply. iSeeCars Executive Analyst Karl Brauer remarked: “The used car market is still seeing the effects of plant shutdowns during COVID-19, which has led to higher prices and shorter supplies of in-demand vehicles like pickup trucks.”
iSeeCars recently looked at asking prices for new and used cars sold between August 2020 and March 2021. The sample size for the study was 2.6 million vehicles. The used cars in the study were “lightly used,” which means they were a year old or less. The average drop in value from the new cars in the sample to the same model slightly used was 17%.
The price of a slightly used BMW 5 Series dropped 36.4% according to the analysis. The 5 Series is BMW’s midsized sedan. Its base price is $54,200. However, one version of the 5 Series costs well in excess of $100,000. Brauer commented about the 5 Series and other high-end sedans: “These price drops reflect the declining popularity of sedans, especially among luxury buyers that have switched to SUVs in recent years.” The smaller 3 Series BMW is also among the cars that lose the most value.
The 15 Used Cars That Lose Their Values Most
|Model||% Difference||$ Difference|
|BMW 5 Series||36.4%||$24,207|
|Mitsubishi Eclipse Cross||31.6%||$8,041|
|BMW 3 Series||29.7%||$15,266|
|Mitsubishi Mirage G4||29.2%||$4,781|
|Hyundai Santa Fe||28.7%||$9,061|
|GMC Yukon XL||27.8%||$22,639|