Price of Second hand car

Top 10 Factors Affecting the Price of a Second-hand Car

December 05, 2023 • 1292 views

Several factors determine second-hand car prices. Whether you are buying or selling a pre-owned car, knowing these factors is essential to understanding its fair market price. Read on to understand used car price factors in detail.

Top 10 Factors Affecting on Price of a Used Car

The price of a second-hand car depends on several underlying factors such as:

1. Car’s Age
The value of a car depreciates with time and usage. Factors like the car's model, variant, demand and supply, etc., also affect the price. The older a car, the more you need to spend on the maintenance and repair of its parts, and the lesser will be its value.

2. Car Model and Make
When it comes to determining the value of a used car, its make and model play a significant role. The popularity of a car depends on its features and quality. Thus, most cars from leading brands are more popular and expensive than non-branded ones. Cars with high demand and limited supply also offer better resale value. Because of their high demand, their price is affected to a certain extent.

3. Car Mileage
Car mileage represents how much distance a car has covered that gets reflected on the odometer. The lower the number of miles/kilometres a car has driven, the higher its resale value. Lower mileage indicates that the car has undergone less wear and tear. Higher mileage cars, on the other hand, might require you to spend more on their maintenance and repairs.
Used-car buyers and sellers should note that mileage is not the only determiner of a car’s price. A car with scratches, dents and damaged internal parts will fetch a lower price than a car in perfect condition even if it has lower mileage.

4. Car Service History
The service history of a car creates an impact on its resale value and often leads to a rise in prices by 10% to 20%. Thus, make sure to maintain records of the service history of your car to raise its resale value. If your car is well-maintained, it appears appealing to buyers as well.

5. Body Type of Car
Some car designs are more desirable to buyers of second-hand vehicles than others. In recent years, the tastes and preferences of purchasing used cars have changed. People prefer purchasing second-hand SUVs to accommodate their families and because of their safety and commercial purpose. Meanwhile, outdated models and cars with known design flaws fetch a lower price.

ALSO READ :- How To Get Loan To Buy An Old Car?

6. Car Damage History
The damage history of second-hand cars has a significant impact on their resale value. If a car has faced an accident, its resale value can considerably depreciate. However, minor scratches or dents will likely not have a large impact.
It is recommended to drive safely to retail good resale value. The damage history of a car reveals if it was involved in an accident and a major part was replaced or repaired. Providing a detailed damage history of a car with no major accidents will increase its selling price.

7. Car Colour
Your car's colour influences its resale price to some extent. For the majority of cases, used car buyers prefer muted colours like black, grey, etc. Cars with these colours generally have a higher price when put for sale when compared to more uncommon colours.

8. Car Exterior Features
Any kind of modification in the exterior part of the car impacts its resale value. Such modifications include painting of the car, tail wings, upgradation of body kit, and more. However, if your car has any scratches or lacks proper maintenance, its value will depreciate in the market.

9. Car Internal Features
Pricing of your car also depends on its internal conditions. Thus, make sure to check the conditions of the interior before listing your car for sale. Things like worn-out seats and dirty interiors will depreciate the car’s value. On the other hand, taking proper care of your car and installing new features like upgrading the sound system, repairing brakes, and putting up reverse cameras will raise the valuation of your car.

10. Frequency of Ownership
Frequency of ownership determines the number of owners of a car and how frequently it changes hands. The more the number of owners, the lesser its resale value. This is because, each time the car changes hands, it undergoes more wear and tear. Furthermore, it is unlikely to undergo regular maintenance.

Why Prefer Used Cars Over New Cars?

The price of new cars has been rising steadily in the market over the years. Thus, it becomes difficult for everyone to purchase a new car. As more and more new cars are getting introduced into the used car market, potential buyers can purchase premium model cars at the same price. Moreover, used cars typically depreciate at a slow rate when compared to any new car. You can also go for less dealership fees and low insurance costs.

To Conclude

Various factors like the car model, colour, mileage, etc. determine the price of a used car. If you are buying or selling a second-hand car, you must be aware of these factors to make a better financial decision. Before you finalise your decision to buy a used car, research thoroughly and select the car looking at its interior and exterior conditions.
To fund a second-hand car, you can avail a Pre-owned Car Loan from Poonawalla Fincorp up to Rs.75 Lakh. The benefits include flexible tenure of repayment, high loan amounts, interest rates, and more. Why wait? Apply now!

Disclaimer

We take utmost care to provide information based on internal data and reliable sources. However, this article and associated web pages provide generic information for reference purposes only. Readers must make an informed decision by reviewing the products offered and the terms and conditions. Pre-Owned Car Loan disbursal is at the sole discretion of Poonawalla Fincorp.
*Terms and Conditions apply

poonawalla fincorp team

Poonawalla Fincorp Team

Our team of expert writers and editors are passionate about providing authentic and valuable information on finance. Our aim is to simplify financial and finance-related concepts. We strive to help our readers become more aware and empowered to make informed financial decisions.

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