Car depreciation calculator
Depreciation is usually the largest cost of owning a car, and the one that never appears on a bill.
After 5 years the car is worth about
$14,616
$20,384 lost — 58% of what you paid
- Value now
- $14,616
- year 5
- Total lost
- $20,384
- 58.2% of purchase price
- Per year
- $4,077
- averaged across ownership
- Per mile
- $0.34
- at 12,000 miles a year
Value by year
- Year 1$28,000−20%
- Year 2$23,800−32%
- Year 3$20,230−42%
- Year 4$17,196−51%
- Year 5$14,616−58%
A declining-balance model with a steeper first year, which is how most cars behave. Actual depreciation varies enormously by make, mileage, condition and demand — a model in short supply can hold value far better than this suggests.
Questions
›How much does a new car lose in the first year?
Typically 15-25%, with the steepest drop happening the moment it stops being new. The default here is 20% in year one and 15% of the remaining value each year after, which tracks the average reasonably well.
›Why is depreciation the biggest cost of owning a car?
Because it is silent. Fuel and insurance arrive as bills you notice; depreciation only appears when you sell. On a $35,000 car held five years it commonly exceeds everything else combined.
›Which cars depreciate least?
Models in short supply, with strong reliability records and steady demand. Trucks and some hybrids hold value notably well; luxury saloons and anything with a large outgoing engine typically do not.
›Does mileage affect depreciation?
Substantially. Above-average mileage accelerates the loss, and the per-mile figure here shows what each mile costs you in value. It is often more than the fuel.
›Is this the same as accounting depreciation?
No. This is market value for a private owner. Tax and accounting depreciation follow prescribed schedules that rarely match what a car is actually worth.