{"id":12281,"date":"2026-07-10T14:46:08","date_gmt":"2026-07-10T13:46:08","guid":{"rendered":"https:\/\/www.exchangemycar.co.uk\/blog\/?p=12281"},"modified":"2026-07-10T14:46:08","modified_gmt":"2026-07-10T13:46:08","slug":"car-depreciation-guide","status":"publish","type":"post","link":"https:\/\/www.exchangemycar.co.uk\/blog\/car-depreciation-guide\/","title":{"rendered":"What is Car Depreciation? A UK Owner&#8217;s Guide"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Car depreciation is often the highest hidden cost of owning a vehicle. The <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/free-car-valuation\"><span style=\"font-weight: 400;\">value of a standard car<\/span><\/a><span style=\"font-weight: 400;\"> decreases over time. The rate, however, depends on make, model, mileage, fuel type, and condition.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This guide covers everything you need to know about car depreciation in the UK. From how it&#8217;s calculated to which cars hold their value, it&#8217;s all here.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Key Takeaways<\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Car depreciation is the difference between what you pay for a car and what it&#8217;s worth when you sell it.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">New cars lose 15% to 35% of their value in year one alone.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">By year three, most cars have lost 40% to 60% of their original price.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Fuel type matters. Hybrids tend to hold value well, while older diesels depreciate faster.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Mileage, service history, colour and condition all influence how quickly a car loses value.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Buying a used car between two and four years old avoids the steepest part of the depreciation curve.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Depreciation directly affects PCP finance payments and total cost of ownership.<\/span><\/li>\n<\/ul>\n<h2><span style=\"font-weight: 400;\">What is Car Depreciation?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Car depreciation is simple. It&#8217;s the drop in your car&#8217;s value over time. Simply put:<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Depreciation = Purchase price \u2212 Current market value.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Buy a car for \u00a325,000. Sell it three years later for \u00a314,000. That \u00a311,000 gap is depreciation.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The moment a new car leaves the forecourt, it becomes &#8220;used&#8221;, and its value falls. That drop continues year after year, though the pace slows as the car ages. Understanding this curve helps you make smarter decisions about when or what to buy and when to sell.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It matters whether you&#8217;re a first-time buyer picking a runaround or a family upgrading to an SUV. Depreciation affects monthly finance payments, <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/can-you-part-exchange-a-car-on-finance-uk-guide\/\"><span style=\"font-weight: 400;\">part-exchange<\/span><\/a><span style=\"font-weight: 400;\"> values and the true cost of running your car over several years. Ignore it, and you could lose thousands more than you need to.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How is Car Depreciation Calculated?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The calculation is straightforward. Here are the four steps:<\/span><\/p>\n<ol>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Find the original purchase price of your car.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Find its current market value.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Subtract the current value from the original price. That&#8217;s your depreciation in pounds.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Divide the depreciation amount by the original price, then multiply by 100. That gives you a percentage.<\/span><\/li>\n<\/ol>\n<h3><span style=\"font-weight: 400;\">Worked Example: \u00a325,000 Car<\/span><\/h3>\n<table>\n<thead>\n<tr>\n<th><b>Description<\/b><\/th>\n<th><b>Amount<\/b><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span style=\"font-weight: 400;\">Original purchase price<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a325,000<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Current market value (after 3 years)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a314,000<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Depreciation amount<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a311,000<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Depreciation percentage<\/span><\/td>\n<td><span style=\"font-weight: 400;\">44%<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">This car has lost 44% of its value in three years. It retains 56%. That retained figure is sometimes called the &#8220;residual value&#8221;. It plays a big role in finance deals (more on that later).<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">How Depreciation Looks Across Price Brackets<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Depreciation hits harder on expensive cars, even when the percentage is similar. Here are some typical UK market ranges:<\/span><\/p>\n<table>\n<thead>\n<tr>\n<th><b>Original Price<\/b><\/th>\n<th><b>Value After 3 Years (approx.)<\/b><\/th>\n<th><b>Amount Lost<\/b><\/th>\n<th><b>% Lost<\/b><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span style=\"font-weight: 400;\">\u00a312,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a37,200<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a34,800<\/span><\/td>\n<td><span style=\"font-weight: 400;\">40%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">\u00a325,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a314,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a311,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">44%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">\u00a340,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a320,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a320,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">50%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">\u00a370,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a330,100<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a339,900<\/span><\/td>\n<td><span style=\"font-weight: 400;\">57%<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<p><span style=\"font-weight: 400;\">Notice the pattern. Higher-priced cars often lose a larger percentage too. Luxury models and premium <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/what-is-a-saloon-car\/\"><span style=\"font-weight: 400;\">saloons<\/span><\/a><span style=\"font-weight: 400;\"> sit in a smaller buyer pool at resale. That pushes depreciation up further.<\/span><\/p>\n<p><div class=\"row saq-cta_div\">\n      <div class=\"col-xl-12\">\n        <div class=\"bg-yellow exchange-deal-content\" style=\"padding: 5rem 3rem;\">\n          <div class=\"title\">\n            <h3 class=\"big mb-4\">\n              Ready to find out what your car is worth today?\n            <\/h3>\n            <p class=\"h6 mb-0 fw-normal\">\n              Depreciation doesn&#8217;t wait. Compare instant offers from specialist buyers who understand your car&#8217;s true market value. Enter your registration and mileage now to get started.\n            <\/p>\n\t\t\t\n          <\/div>\n         \t <form class=\"row g-4 g-sm-5 gy-5 get-quote-form\" style=\"margin-top:20px;\" action=\"https:\/\/www.exchangemycar.co.uk\/my-details\" method=\"post\" id=\"reg_form\" name=\"reg_form\">\n    <div class=\"col-6\">\n      <div class=\"position-relative\">\n        <div class=\"gb-icon-wrap small\">\n          <img src=\"https:\/\/www.exchangemycar.co.uk\/blog\/wp-content\/themes\/ssaq\/assets\/images\/icons\/gb.svg\" alt=\"GB\">\n        <\/div>\n        <input type=\"text\" name=\"reg_num\" required=\"\" class=\"form-control gb-icon saq-reg_field_color saq-milage-field\" placeholder=\"ENTER REG \" title=\"Please enter registration number\" maxlength=\"7\" value=\"\">\n      <\/div>\n    <\/div>\n    <div class=\"col-6\">\n          <input type=\"number\" class=\"form-control js-milage_commo saq-milage-field  saq-mileage_field_color\" name=\"mileage\" placeholder=\"MILEAGE\">\n    <\/div>\n    <div class=\"col-12\">\n      <button type=\"submit\" name=\"homesearch\" class=\"btn btn-big  saq-button-field btn-blue w-100\">Sell My Car<\/button>\n    <\/div>\n  <\/form>\n        <\/div>\n      <\/div>\n    <\/div><\/p>\n<h2><span style=\"font-weight: 400;\">How Much Does a Car Depreciate Per Year?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Car depreciation follows a curve. Steep at first, then gradually flattening as the car gets older.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Year-by-Year Depreciation<\/span><\/h3>\n<table>\n<thead>\n<tr>\n<th><b>Year<\/b><\/th>\n<th><b>Typical Depreciation Range<\/b><\/th>\n<th><b>Approximate Value Remaining<\/b><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span style=\"font-weight: 400;\">Year 1<\/span><\/td>\n<td><span style=\"font-weight: 400;\">15% to 35%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">65% to 85%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Year 2<\/span><\/td>\n<td><span style=\"font-weight: 400;\">10% to 15% (additional)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">55% to 70%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Year 3<\/span><\/td>\n<td><span style=\"font-weight: 400;\">8% to 12% (additional)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">40% to 60%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Year 5<\/span><\/td>\n<td><span style=\"font-weight: 400;\">5% to 8% per year<\/span><\/td>\n<td><span style=\"font-weight: 400;\">30% to 40%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Year 8 to 10<\/span><\/td>\n<td><span style=\"font-weight: 400;\">2% to 5% per year<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Around 20%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Year 10+<\/span><\/td>\n<td><span style=\"font-weight: 400;\">1% to 3% per year<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Stabilising<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">The first year is brutal. A \u00a330,000 new car <\/span><i><span style=\"font-weight: 400;\">could <\/span><\/i><span style=\"font-weight: 400;\">lose \u00a310,000 in twelve months. Compare that to year seven, where the same car might only lose \u00a3600 to \u00a3800 in value. The curve flattens <\/span><i><span style=\"font-weight: 400;\">dramatically<\/span><\/i><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This is exactly why <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/buying-a-used-vs-new-car-advantages-and-disadvantages\/\"><span style=\"font-weight: 400;\">buying a used car<\/span><\/a><span style=\"font-weight: 400;\"> aged two to four years old makes financial sense. Someone else absorbs that steep initial drop. You step in when the value loss is far more gradual.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Factors Affecting the Rate of Vehicle Depreciation<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Several factors determine how fast your car loses value. Here is a brief overview:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Mileage:<\/b><span style=\"font-weight: 400;\"> The UK average is around 7,100 miles per year. Cars above that depreciate faster. Motorway miles are kinder than stop-start driving.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Age:<\/b><span style=\"font-weight: 400;\"> Newer models offer updated tech and safety. Older cars compete with fresher alternatives at similar prices.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Condition:<\/b><span style=\"font-weight: 400;\"> Dents, scratches and worn interiors reduce value. A clean car sells for more.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Service history:<\/b><span style=\"font-weight: 400;\"> A full record proves proper maintenance. Gaps make buyers nervous and lower offers.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Previous owners:<\/b><span style=\"font-weight: 400;\"> Fewer keepers generally means a higher value.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Supply and demand:<\/b><span style=\"font-weight: 400;\"> Popular models hold value. Discontinued cars can strengthen as supply tightens.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Reliability reputation:<\/b><span style=\"font-weight: 400;\"> Brands like Toyota and <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/what-does-lexus-stand-for\/\"><span style=\"font-weight: 400;\">Lexus<\/span><\/a><span style=\"font-weight: 400;\"> depreciate more slowly due to proven longevity.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Running costs:<\/b><span style=\"font-weight: 400;\"> Expensive insurance, fuel and servicing lower what buyers will pay.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Colour:<\/b><span style=\"font-weight: 400;\"> Neutral colours (white, black, silver, grey) hold value across most car types.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Spec level:<\/b><span style=\"font-weight: 400;\"> Well-specced cars attract more interest at resale, though pricey extras rarely return full cost.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Modifications:<\/b><span style=\"font-weight: 400;\"> Aftermarket changes tend to narrow the buyer pool and reduce value.<\/span><\/li>\n<\/ul>\n<p><img src=\"https:\/\/www.exchangemycar.co.uk\/assets\/empty.png\" data-original=\"https:\/\/www.exchangemycar.co.uk\/timthumb.php?src=https%3A%2F%2Fwww.exchangemycar.co.uk%2Fblog%2Fwp-content%2Fuploads%2F2026%2F07%2FFactors-that-affect-car-depreciation.png&w=777&h=485\" class=\"img-fluid img-inherit img-cover lazy\" alt=\"Factors that affect car depreciation\" \/><\/p>\n<h2><span style=\"font-weight: 400;\">Car Depreciation by Fuel Type<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Not all fuel types depreciate at the same rate.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Petrol Cars<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Petrol cars follow a fairly standard depreciation curve. They remain popular in the <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/best-small-cars-uk\/\"><span style=\"font-weight: 400;\">small car<\/span><\/a><span style=\"font-weight: 400;\"> and <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/what-is-a-hatchback-car\/\"><span style=\"font-weight: 400;\">family hatchback<\/span><\/a><span style=\"font-weight: 400;\"> segments. Demand stays consistent, and running costs are predictable. Petrol models from reliable brands tend to hold value well, especially in lower mileage examples.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Diesel Cars<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Diesel depreciation has accelerated since 2017. The emissions scandal and expanding clean air zones have hit diesel values hard. Rising road tax on higher-emission vehicles adds further pressure. Older diesels (pre-Euro 6) are particularly affected. Many cannot enter <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/ulez-checker\"><span style=\"font-weight: 400;\">ULEZ<\/span><\/a><span style=\"font-weight: 400;\"> or other clean air zones without a daily charge.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Newer Euro 6 diesels fare better, particularly in larger vehicles where diesel&#8217;s fuel efficiency advantage is most noticeable. However, diesel (on the whole) as a fuel type is under ongoing depreciation pressure.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Hybrid Cars<\/span><\/h3>\n<p><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/best-hybrid-cars\/\"><span style=\"font-weight: 400;\">Hybrids<\/span><\/a><span style=\"font-weight: 400;\">, particularly full (self-charging) models, are among the strongest performers for holding value. Toyota&#8217;s hybrid range regularly tops residual value charts. Plug-in hybrids (PHEVs) are more mixed, however. Early models with modest electric-only range have depreciated faster as newer, more capable alternatives have arrived.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Electric Cars (EVs)<\/span><\/h3>\n<p><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/should-you-buy-an-electric-car\/\"><span style=\"font-weight: 400;\">Electric vehicle<\/span><\/a><span style=\"font-weight: 400;\"> depreciation tells two different stories. Early-generation EVs with modest range and older battery technology have seen steep drops. Models financed during the post-pandemic supply shortage were hit especially hard as the market corrected. Newer EVs, however, with 250+ miles of real-world range, are showing more stable residuals. As charging infrastructure improves and buyer confidence grows, depreciation on capable modern EVs is expected to level out.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Fuel Type Depreciation Comparison (3-Year Typical Range)<\/span><\/h3>\n<table>\n<thead>\n<tr>\n<th><b>Fuel Type<\/b><\/th>\n<th><b>Typical 3-Year Depreciation<\/b><\/th>\n<th><b>Trend<\/b><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span style=\"font-weight: 400;\">Petrol<\/span><\/td>\n<td><span style=\"font-weight: 400;\">40% to 55%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Stable<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Diesel<\/span><\/td>\n<td><span style=\"font-weight: 400;\">45% to 65%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Higher pressure, especially older models<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Full hybrid<\/span><\/td>\n<td><span style=\"font-weight: 400;\">35% to 45%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Strong residuals<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Plug-in hybrid<\/span><\/td>\n<td><span style=\"font-weight: 400;\">40% to 55%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Mixed, depends on electric range<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Electric (modern, 250+ miles)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">40% to 50%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Stabilising<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Electric (early-gen, sub-150 miles)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">55% to 70%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Steep drops<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2><span style=\"font-weight: 400;\">When Does a Car Depreciate the Most?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Often the largest single drop happens the moment you drive a new car away from the dealer. That instant switch from <\/span><b>&#8220;new&#8221; to &#8220;used&#8221;<\/b><span style=\"font-weight: 400;\"> can knock thousands off the value in minutes. It&#8217;s called <\/span><i><span style=\"font-weight: 400;\">instant depreciation<\/span><\/i><span style=\"font-weight: 400;\">, and there&#8217;s no way around it when buying new.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Year one is where the damage is heaviest. After that, the rate slows. By year five or six, losses may only be 5% to 8% annually. By ten years, as little as 1% to 3%.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Key Depreciation Milestones<\/span><\/h3>\n<table>\n<thead>\n<tr>\n<th><b>Milestone<\/b><\/th>\n<th><b>Why It Matters<\/b><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span style=\"font-weight: 400;\">Driving off the forecourt<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Instant &#8220;new to used&#8221; switch. Largest single value drop.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">First <\/span><a href=\"https:\/\/www.gov.uk\/check-mot-history\"><span style=\"font-weight: 400;\">MOT<\/span><\/a><span style=\"font-weight: 400;\"> (3 years)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">No longer under standard manufacturer warranty. Value drops.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">60,000 miles<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Psychological barrier for many buyers. Prices often dip at this point.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">100,000 miles<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Major milestone. Many buyers avoid cars above this. Significant price impact.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">10 years old<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Depreciation largely flattens. Values hold relatively steady.<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<p><div class=\"row saq-cta_div\">\n      <div class=\"col-xl-12\">\n        <div class=\"bg-yellow exchange-deal-content\" style=\"padding: 5rem 3rem;\">\n          <div class=\"title\">\n            <h3 class=\"big mb-4\">\n              Thinking about the right time to sell?\n            <\/h3>\n            <p class=\"h6 mb-0 fw-normal\">\n              Timing matters when depreciation is involved. Compare instant offers from specialist buyers to see what your car could fetch today. Enter your registration and mileage now to get started.\n            <\/p>\n\t\t\t\n          <\/div>\n         \t <form class=\"row g-4 g-sm-5 gy-5 get-quote-form\" style=\"margin-top:20px;\" action=\"https:\/\/www.exchangemycar.co.uk\/my-details\" method=\"post\" id=\"reg_form\" name=\"reg_form\">\n    <div class=\"col-6\">\n      <div class=\"position-relative\">\n        <div class=\"gb-icon-wrap small\">\n          <img src=\"https:\/\/www.exchangemycar.co.uk\/blog\/wp-content\/themes\/ssaq\/assets\/images\/icons\/gb.svg\" alt=\"GB\">\n        <\/div>\n        <input type=\"text\" name=\"reg_num\" required=\"\" class=\"form-control gb-icon saq-reg_field_color saq-milage-field\" placeholder=\"ENTER REG \" title=\"Please enter registration number\" maxlength=\"7\" value=\"\">\n      <\/div>\n    <\/div>\n    <div class=\"col-6\">\n          <input type=\"number\" class=\"form-control js-milage_commo saq-milage-field  saq-mileage_field_color\" name=\"mileage\" placeholder=\"MILEAGE\">\n    <\/div>\n    <div class=\"col-12\">\n      <button type=\"submit\" name=\"homesearch\" class=\"btn btn-big  saq-button-field btn-blue w-100\">Sell My Car<\/button>\n    <\/div>\n  <\/form>\n        <\/div>\n      <\/div>\n    <\/div><\/p>\n<h2><span style=\"font-weight: 400;\">Which Cars Depreciate the Fastest?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Some car types make poor new purchases but excellent used buys.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Large luxury saloons top the list. The Mercedes S-Class, BMW 7 Series and Audi A8 can lose 50% to 70% of their value within three years. The buyer pool is small relative to volume produced.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Large MPVs have also fallen hard as<\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/best-suv-uk\/\"> <span style=\"font-weight: 400;\">SUVs<\/span><\/a><span style=\"font-weight: 400;\"> displaced them. Early-generation EVs and older diesels face ongoing depreciation pressure too.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Which Cars Hold Their Value?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">At the other end of the spectrum, some cars resist depreciation stubbornly. They cost more to buy used, but they also retain more value if you come to sell.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Toyota and Lexus full hybrids lead the pack. Models like the Yaris Hybrid, RAV4 Hybrid and Lexus UX regularly appear in low-depreciation rankings.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Small, popular cars with loyal followings also hold value well. High demand and limited supply keep prices firm. Discontinued models like the <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/ford-fiesta-vs-vauxhall-corsa\/\"><span style=\"font-weight: 400;\">Ford Fiesta<\/span><\/a><span style=\"font-weight: 400;\"> can even see values strengthen as good used examples become scarcer.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Mid-size SUVs from mainstream brands show strong residuals too. The Nissan Qashqai, Kia Sportage and Volkswagen Tiguan depreciate more slowly than many rivals. Consistent family buyer demand keeps their values firm.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How Depreciation Affects Car Finance and PCP<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">If you\u2019re buying on PCP finance, depreciation is built directly into your monthly payments.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">PCP splits the car&#8217;s cost into two parts. The first is the depreciation you pay over the contract term. The second is the guaranteed future value (GFV). That&#8217;s what the finance company expects the car to be worth at the end. Your monthly payments cover the depreciation portion, plus interest.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A car with strong residuals has a higher GFV. That means less depreciation to finance and lower monthly payments.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">PCP Comparison: Same Price, Different Residuals (Illustrative Example)<\/span><\/h3>\n<table>\n<thead>\n<tr>\n<th><\/th>\n<th><b>Weak Residual Car<\/b><\/th>\n<th><b>Strong Residual Car<\/b><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span style=\"font-weight: 400;\">Purchase price<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a325,000<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a325,000<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">APR<\/span><\/td>\n<td><span style=\"font-weight: 400;\">9.9%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">9.9%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Term<\/span><\/td>\n<td><span style=\"font-weight: 400;\">48 months<\/span><\/td>\n<td><span style=\"font-weight: 400;\">48 months<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Guaranteed future value<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a39,500 (38%)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a314,000 (56%)<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Depreciation to finance<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a315,500<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a311,000<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Approximate monthly payment<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a3390<\/span><\/td>\n<td><span style=\"font-weight: 400;\">\u00a3285<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">That&#8217;s roughly a \u00a3105 per month difference. Over a four-year term, it exceeds \u00a35,000. Same price. Same interest rate. The only variable is how well the car holds its value.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">When is the Optimal Time to Sell?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Timing your sale well can save you thousands.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Before the First MOT (Under 3 Years)<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Selling before the three-year mark means the car is still within the manufacturer&#8217;s standard warranty period. This supports a higher price, though you&#8217;ve already absorbed the steepest depreciation if you bought new.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">The Sweet Spot: 3 to 5 Years<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Buying a used car at two to three years and selling at five to six balances enjoyment with financial efficiency. The depreciation rate has slowed considerably by this point.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Before Major Mileage Milestones<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Selling just before 60,000 or 100,000 miles can help. Buyers psychologically favour cars below these round numbers. A car at 58,000 miles will often attract more interest (and a higher price) than the same car at 62,000.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Seasonal Timing<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Convertibles and sports cars sell better in spring and summer. <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/benefits-of-driving-a-4wd-four-wheel-drive-vehicle\/\"><span style=\"font-weight: 400;\">Four-wheel-drive vehicles<\/span><\/a><span style=\"font-weight: 400;\"> and SUVs see stronger demand in autumn and winter. Aligning your sale with seasonal demand can make a noticeable difference.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Watch for Regulation Changes<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">New emissions rules or clean air zone expansions can affect your car&#8217;s value. Staying informed helps you plan ahead and avoid unexpected drops.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How to Reduce Car Depreciation<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">You cannot stop depreciation entirely, but it can be slowed.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Buy used, not new.<\/b><span style=\"font-weight: 400;\"> A two-to-four-year-old car has already absorbed the steepest drop.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Keep mileage reasonable.<\/b><span style=\"font-weight: 400;\"> Stay close to the UK average of 7,100 miles per year.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Maintain a full <\/b><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/can-i-sell-a-car-without-a-service-history\/\"><b>service history<\/b><\/a><b>.<\/b><span style=\"font-weight: 400;\"> Book every service on time and keep receipts.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Choose a popular model in a sensible colour.<\/b><span style=\"font-weight: 400;\"> White, black, silver and grey hold value well.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Keep the car in good condition.<\/b><span style=\"font-weight: 400;\"> Regular cleaning and prompt minor repairs help.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Avoid unnecessary modifications.<\/b><span style=\"font-weight: 400;\"> Factory standard appeals to more buyers.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Choose a reliable brand.<\/b><span style=\"font-weight: 400;\"> Strong reliability supports stronger residuals.\u00a0<\/span><\/li>\n<\/ul>\n<p><img src=\"https:\/\/www.exchangemycar.co.uk\/assets\/empty.png\" data-original=\"https:\/\/www.exchangemycar.co.uk\/timthumb.php?src=https%3A%2F%2Fwww.exchangemycar.co.uk%2Fblog%2Fwp-content%2Fuploads%2F2026%2F07%2FAdobeStock_1708260043-scaled.jpeg&w=777&h=485\" class=\"img-fluid img-inherit img-cover lazy\" alt=\"How Much Does a Car Depreciate Per Year\" \/><\/p>\n<h2><span style=\"font-weight: 400;\">Conclusion: Car Depreciation<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Car depreciation affects every driver, whether buying, selling or financing a vehicle. The curve is steepest in year one and levels out over time. Understanding this pattern helps you make smarter financial decisions.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Buy used where possible and choose models with strong residual values. Keep mileage sensible and try to maintain a full service history. These details add up to thousands of pounds at resale.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">FAQs<\/span><\/h2>\n<h3><span style=\"font-weight: 400;\">Is depreciation the highest cost of car ownership?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">For most drivers, yes. Depreciation typically costs more than fuel, insurance, servicing and road tax combined over a three-to-five-year ownership period. It is often overlooked because it&#8217;s not a regular payment.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Do electric cars depreciate faster than petrol?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">It depends on the model. Early-generation EVs with limited range have depreciated steeply. Newer <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/cheapest-electric-cars-uk\/\"><span style=\"font-weight: 400;\">electric cars<\/span><\/a><span style=\"font-weight: 400;\"> with 250+ miles of range are showing much more stable values. The market, however, is still evolving, and depreciation patterns for EVs are likely to continue shifting as technology and infrastructure improve.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Can a car increase in value?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Rarely, but it happens. Limited-edition performance cars, certain <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/pros-and-cons-of-owning-a-classic-car\/\"><span style=\"font-weight: 400;\">classic cars<\/span><\/a><span style=\"font-weight: 400;\"> and models that become unexpectedly collectable can appreciate over time. This is a specialist area though, and it should not be assumed broadly.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Does car colour really affect depreciation?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Yes. Neutral colours (white, black, silver, grey) consistently hold value better than unusual colours. A bright or uncommon colour limits the buyer pool. It can therefore lower the resale price or extend the time it takes to sell.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">How does depreciation differ between brands?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Significantly. Brands like Toyota, Lexus and <\/span><a href=\"https:\/\/www.exchangemycar.co.uk\/blog\/is-porsche-german\/\"><span style=\"font-weight: 400;\">Porsche<\/span><\/a><span style=\"font-weight: 400;\"> tend to depreciate more slowly due to reliability reputations and consistent demand. Volume manufacturers with weaker reliability records often depreciate faster. Individual model performance varies within every brand, however.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">What does &#8220;residual value&#8221; mean?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Residual value is the percentage of the original price a car retains after a set period. Higher residual values mean slower depreciation and, in many cases, lower PCP finance payments. <\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Car depreciation is often the highest hidden cost of owning a vehicle. The value of a standard car decreases over time. The rate, however, depends on make, model, mileage, fuel type, and condition. This guide covers everything you need to know about car depreciation in the UK. From how it&#8217;s calculated to which cars hold [&hellip;]<\/p>\n","protected":false},"author":13,"featured_media":12283,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_mi_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[1],"tags":[1879,1880],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/posts\/12281"}],"collection":[{"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=12281"}],"version-history":[{"count":3,"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/posts\/12281\/revisions"}],"predecessor-version":[{"id":12289,"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/posts\/12281\/revisions\/12289"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/media\/12283"}],"wp:attachment":[{"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=12281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=12281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.exchangemycar.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=12281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}