GETTING THE HIGHEST RESALE VALUE FOR YOUR VEHICLE. PROFESSIONAL AUTO DETAILING MAKES A SIGNIFICANT IMPACT!
YOUR CAR IS AN INVESTMENT, NOT JUST TRANSPORTATION.
For most of us, vehicle ownership will be our second largest investment over our lifetime. But, let’s face it, vehicles depreciate rapidly and on average we transition to a newer vehicle every 6.5 years. That’s a lot of transactions, so it’s fair to say that we lose money every time we complete a vehicle ownership cycle. The challenge is minimizing the loss. We tend to focus on tips about buying smarter, or getting a better deal on the front end.
But what about smart ownership strategies that maximize the value of your vehicle when it’s time to sell or trade? Thousands of dollars are at stake based on our habits and maintenance choices. You may be surprised to learn that it’s the middle and back end of the automotive ownership cycle, where car owners loose the most money, and it’s also the best opportunity to minimize overall depreciation, so we can keep more money in our pocket while enjoying our cars more during the ownership cycle.
LET’S REVIEW THE PRIMARY FACTORS THAT DETERMINE THE VALUE OF YOUR CAR WHEN IT’S TIME TO SELL OR TRADE IT IN.
Method of Sale. In most states, if you trade in your vehicle, you won’t pay transfer taxes on the value of the trade, but most sellers will still make out better by selling privately to a willing buyer. You’ll both skip the middle man, but the buyer doesn’t get a warranty, so the car has to be in Very Good or Excellent Condition with no obvious mechanical issues. Do your pricing research and then do the math. https://www.naaa.com/standards/vehicle_gradingscale.pdf is an excellent scoring guide for buyers and sellers. I advise sellers to also search for similar vehicles for sale in their local market. In general, you’ll want to price your vehicle a little less than used car dealers are asking– if they include a warranty. But, leave some room for negotiation with prospective buyers as well. 3-5% is a good barter range. The goal of a private sale is for the seller to get 8-10% more than a dealer will offer you for your trade, and for the buyer to get the car for 5-7% less than going through a dealer. The typical dealer markup is %15 or more, which leaves money on the table for the buyer and seller in a private transaction.
The Age/Mileage ratio. Vehicles that are driven less than 15,000 miles per year tend to sell faster than those driven more than 15,000 miles per year. You’ll get a stronger valuation on paper as well, IF the vehicle is in Very Good or Excellent condition… and that’s a critical part of the formula because 75% of vehicles that are five or more years old struggle to meet this conditional criteria due to visual flaws. Even foggy headlight lenses, swirl marks in the paint or a few interior stains can knock a car out of this elite ranking, and that will cost you money.
Mechanical Condition. This is where areas of neglect and procrastination can come back to haunt you, big time. If you feel a vibration, notice a leak or see a warning lamp, ACT FAST! Early diagnosis can save hundreds of dollars, and ignoring problems is never smart. Change the oil and filters regularly, rotate the tires and be sure to have a technician inspect the brakes and other systems at every oil change. For more extensive problems, try to get multiple quotes– if not covered under warranty. Bottom line; Keep your vehicle in proper mechanical condition, but don’t get hosed.
Visual Condition. Perception is reality, and a car that shines and smells like new (inside & out) will always command a premium price, (trade or private sale). The goal here is to easily meet the criteria of “Excellent Condition”. This is an area where owners play a vitally important role, by seeking out professional services for interior deep cleaning, exterior detailing and paint correction. Spending $200 to $300 with a professional detailing service before the photo shoot could easily yield an extra grand on resale.
THE NEGOTIATION LEVERAGE IN A PRIVATE SALE REVOLVES AROUND VISUAL CONDITION.
If the car doesn’t look amazing for it’s age, prospective buyers will shy away or demand a lower price. People tend to equate the visual condition with the overall condition of the car, and maintenance habits of the owner. Few buyers will look past interior stains, faded paint, scratches or a dirty engine bay, without demanding a lower price. Don’t give buyers an excuse to haggle. Flip the leverage in your favor by presenting a freshly detailed vehicle, and you’ll likely get your price.
Phil Black- IDSA