According to iSeeCars' study of three million used cars sold in 2022, the average five-year-old car only lost 33.3% of its value from MSRP. Compared to 2021, that represents a significant decrease in depreciation by 17.0%.
"The relative scarcity of late-model used cars due to pandemic-related new car production disruptions has kept used car values high for more than a year," said Karl Brauer, Executive Analyst for iSeeCars. Looking at individual models, the Jeep Wrangler tops the best resale value cars, while the BMW 7 Series is the vehicle with the highest rate of depreciation.
The vehicles with the lowest depreciation - or best resale value - over five years:
- Jeep Wrangler: -7.3%
- Jeep Wrangler Unlimited: -8.7%
- Porsche 911: -14.6%
- Toyota Tacoma: -14.9%
- Honda Civic: -16.3%
- Subaru BRZ: -18.2%
- Ford Mustang: -19.4%
- Toyota Corolla: -19.8%
- Nissan Versa: -19.9%
- Chevrolet Camaro: -20.2%
You may be surprised to learn that some vehicles actually appreciate in value within the first three years after they leave dealer lots.
Used vehicles worth more than their new MSRP:
- Porsche 911: +5.7% increase
- Toyota RAV4 Hybrid: +2.5% increase
- Jeep Wrangler Unlimited: +2.0% increase
- Porsche 718 Cayman: +1.8% increase
- Jeep Wrangler: +0.3% increase
iSeeCars found that midsize trucks, sports cars, and fuel-efficient vehicles held their values best. "The market is pricing late-model used cars as though they were new. If shoppers can't buy a new car, the next closest thing is a used car with low miles, thus the appreciation in value for these cars," according to Karl Brauer, executive analyst for iSeeCars.
According to iSeeCars, depreciation rates are slowing down across various time periods. After analyzing data from three-year depreciation, they found that it has declined by an average of 16.9%. This is a much slower rate than what was seen last year, which averaged 23.8%. With the high demand for new vehicles and low supply, prices are rising as is depreciation rates. It's wise for buyers to be mindful of a car's depreciation rate because it will affect the resale value down the road. According to the firm, making this consideration can save future owners thousands of dollars.
Source: iSeeCars
