Depreciation Calculator

What depreciation means for a car owner

Depreciation is the fall in a car's value over time. It is not a bill you receive, but it is a real cost, because the car you own is worth less each year than it was before. For most people running a newer car, depreciation is the single largest cost of ownership, ahead of fuel, insurance, servicing and tyres. Those other costs arrive in smaller amounts, while the value lost to depreciation only becomes obvious when you sell or part-exchange.

Depreciation is usually steepest in the first year and slows in the years that follow. A car loses value fastest when it is newest, then the rate tends to flatten as it ages. The calculator above gives you an estimate of that curve for your own figures, so you can see roughly what the car may be worth at a chosen point in the future.

The main factors that drive depreciation

No two cars depreciate at the same rate, and the reasons are practical. Mileage is one of the biggest. Higher mileage generally reduces value, because a buyer assumes more wear and a shorter remaining life before major work is needed. A car used for a long daily commute will shed value faster than one used for short weekend trips.

Condition matters just as much. A full, unbroken service history and a clean MOT record support resale value, because they show the car has been maintained and has no unresolved faults. Gaps in MOT history, recorded mileage inconsistencies, and an insurance write-off marker all reduce what a buyer will pay. These are the things a careful buyer checks first.

Other factors include the number of previous keepers, since a long list of owners suggests the car has been passed around, and desirability, which covers how sought-after the model, trim and colour are. Fuel type plays a part too: demand shifts between petrol, diesel, hybrid and electric depending on running costs and buyer preferences, and that demand feeds straight into resale value.

What you can do to protect resale value

You cannot stop depreciation, but you can slow it and avoid the avoidable losses. The steps that help most are the ones a future buyer will look for:

• Keep the service history complete and stamped, with receipts for any work done.
• Deal with MOT advisories promptly rather than letting them become failures.
• Keep the mileage consistent and documented, and never let records conflict.
• Maintain the bodywork and interior, since visible neglect signals neglect elsewhere.
• Choose a popular model, trim and colour if resale value matters to you.

Running costs are worth watching alongside value. A fuel cost calculator can show what a car costs you to run, which helps you judge whether a cheaper-to-run model is worth choosing even if its resale value is lower.

Using the projection sensibly

Treat the figure the calculator produces as an estimate, not a promise. It is built from the inputs you give it, and real-world values depend on the specific car, its exact condition, its history and what buyers happen to want at the time you sell. Two identical models with the same age and mileage can be worth noticeably different amounts if one has a full service record and the other has gaps.

Use the projection to compare options and plan, not to set a firm sale price. A genuine valuation needs the individual car inspected and its history verified.

Why a history check protects you as a buyer

If you are buying, the same factors that reduce a car's value are the ones you should check before agreeing a price. A mileage check can reveal inconsistencies between recorded readings, and a write-off check shows whether the car has been written off by an insurer. An MOT history check reveals gaps, failures and advisories that a seller may not mention.

Checking first means you pay a price that reflects the car's real condition and history, rather than one that assumes everything is in order. It is the simplest way to avoid overpaying for a car that has already lost value for reasons the seller has not disclosed.