It's no secret that new cars lose their value quickly. But not all cars depreciate at the same rate. As
a general rule of thumb, the higher the demand for a car, the less it tends to devalue over time.
According to Canstar 1, new vehicles depreciate an average of 19% in the first year. Some cars lose as
much as 40% of their value in the first year. In the second and third year, this may drop by another 15%.
However, not all cars are a bad investment. New cars tend to be more fuel efficient, less prone to
breakdowns, and covered under their warranty.
If you're buying a new car model, it's worth considering the resale value – the price you'd reasonably
expect to get for your car if you resell it. This is important if you find yourself locked into a
finance plan at the new car price, for a car which will depreciate in value over time, especially as
newer models hit the road.