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Car Valuations: How much is your car worth?
February 19, 2021●
6 minute read●
Have you ever asked yourself, ‘how much is my car worth?’ Whether you’re just curious or are genuinely considering buying or selling your vehicle, a car valuation is helpful for any of these scenarios. A car is one of the most valuable assets most people will own in their lifetime, other than a house. Getting a car valuation in Australia is a helpful way to get your bearings when it comes to your car’s value and how this can be improved or lessened over time.
What is a car valuation?
A car valuation, otherwise known as a car appraisal, is an estimate of the current price of a car. It’s helpful when you’re insuring, buying, selling or trading in a car to ensure that you are getting the right price for your vehicle’s value.
When would you need a car valuation?
There are a few scenarios in which knowing the value of your car is particularly helpful.
There are typically two options when insuring your car: you can ensure it for its market value or for an agreed value. Market value refers to the amount your car would be sold for in the market at that time. Your insurer will determine your car’s value based on factors including its make, model, age, mileage, condition and anything else that is relevant.
Alternatively, agreed value cover is an amount that is decided upon after discussion between you and your insurer. The benefit of this insurance policy is that it provides absolute certainty of how much you would receive if you made a claim (i.e. if your car was written off). It is important to note that agreed value policies are often more expensive premiums than market value policies for this reason.
Selling a car
The average life of a car being used in Australia is 10.1 years, so it is safe to say that whether it’s in a week or a decade, you will likely sell your car at some point in the future.
If you’re considering selling your vehicle, a car valuation gives you a realistic idea of what you might receive when you sell.
Buying a car
It is always helpful to know what you’re talking about. Whether it’s a first car, a brand Mercedes or a family upgrade, knowing a car’s value helps you purchase it for the right price. It also puts you in a stronger position to negotiate if you have reason to believe the price is inaccurate.
Trading in a car
If you’re thinking about trading in your car, knowing its worth can be helpful in deciding whether to sell privately or trade it in at a dealership. Being able to compare your car’s value with what dealers are offering can give you a realistic idea of which option will be most profitable.
What factors influence your car’s value?
There are a lot of factors that can influence your car’s value. All of these factors can continue to impact your car’s value over time.
Unfortunately, the car’s depreciate faster than any other asset. Your car can lose up to 58% of its initial value after just three years of ownership (this is for a brand new car). It’s safe to say that the older your car gets, the less it will be worth.
Make and model
Branding is everything. It’s no secret that a Lambrogini will be worth more than a Holden in every instance. In the case of a Suzuki Alto, Suzuki is the make and Alto is the model.
The make and model plays a large role in what a car is valued. According to Car Advice, Mazda and Toyota are the most popular brands for used cars; this is because they have built up a reputation for being reliable and reputable brands over time.
No one wants a computer with a massive crack in the screen, right? The same can be said about a car. A vehicle with paint in excellent condition is likely to be worth more than a car covered in scratches and dents. Along with its physical appearance, a car’s service history is an important factor in its value. The service history details regular maintenance as well as any additional repairs that have been done to a vehicle. Showing that a car has had regular maintenance shows it has been well taken care of, and can improve the car’s value.
Another important one is mileage. Standard cars are expected to keep running up to 200,000 miles, while electric cars are expected to last up to 300,000 miles. If your car is approaching these figures, it’s obviously going to be worth less.
How can I value my car?
There are a number of avenues for you to get an approximate valuation of your car. You can get a free car valuation by using an online appraisal tool, for example, through Carsales.com.au.
Additionally, you can use these three free car valuation tools. You will need to enter some information about your vehicle, including its make, model, mileage, age etc and it will give you an estimate usually within a few seconds.
If you want a more detailed and precise estimate, you can take your car to an independent valuer or dealership. This is also helpful when looking to purchase a vehicle so that you can ensure there are no major faults with it.
How can I improve the value of my car?
The car’s condition clearly corresponds with its value. Keeping your car in good condition will likely help it hold its value better over time. These are some tips that may improve the value of your car:
- Clean it: ensure that both the interior and exterior are clean before you put it up for sale. You may choose to fix any scratches or dents yourself or use a professional.
- Keep a complete, up-to-date service history: this demonstrates that the car was well taken care of. Without a complete service history demonstrating regular services, your car’s value can decrease.
- Replace missing or faulty parts: this should be a given. If your car has any faulty or missing parts, ensure you get these fixed before you sell because this can decrease its value. If you aren’t going to get the car fixed, ensure you know how much it would cost to fix if the buyer wishes to negotiate on price.
Looking to purchase a car?
If you’re looking into purchasing a car, another important factor to consider is your car finance options. There are a lot of options available at your disposal; this includes a car loan. Cars are very expensive, and it is often not realistic to purchase one outright. Jacaranda Finance offers car loans online up to $35,000 for both new and used cars. Our repayment terms are flexible, from 1 to 4 years. So, no matter how much you wish to borrow, you can pay it back at your own pace comfortably.
If you’ve never financed a car before, it will be helpful for you to know how a car loan works in Australia. Thinking about buying a car, but not sure what will suit your needs? These are the 10 best cars to buy in Australia 2021.
Written by Jacaranda Team