Many new-car buyers are wasting thousands of dollars on high-priced extra equipment which is worth nothing at resale time.
A lot of optional equipment depreciates far faster than the car it is fitted to, and rapid changes in standard equipment can overtake impressive showroom choices in as little as three years. Extra safety equipment is hit among the hardest by depreciation, as used-car buyers are reluctant to pay extra for additional airbags or ESP stability control.
Yet a sunroof or leather trim or flashy alloy wheels could get a payback at trade-in or resale time as upmarket additions can add extra appeal. Even the right colour choice can make a difference to a car’s secondhand value, as trendy colours become unpopular quickly while staples such as white, silver and black tend to be timeless.
“You have to be very careful. If you start by spending $3000 on options it might all be worthless in a few years,” the spokesman for car-price authority, Glass’s Information services, says. “If the car depreciates at 40 per cent, some of these options can depreciate at twice that, or more,” says Chris D’Sousa.
He says flashy extra gear, including sunroofs and leather trim, might not put extra cash in the wallet but could make it easier to get a sale. “They don’t really add resale value. They add resale appeal,” D’Sousa says.
Glass’s tracks values for more than 40 items of optional equipment, currently tracking it backwards to cars sold in 2000. The list includes everything from extra airbags to CD players, body kits, bullbars and Xenon headlamps. A range of extras is rated with zero value after 10 years, including anti-skid brakes, cruise control (which hits zero at seven years), and a six-stack CD player.
Glass’s believes the best approach to new-car shopping is to choose a car that is already well equipped, only adding optional essentials such as a towbar. “If you take a basic car, it’s better to take a higher-spec model because options deprectiate a lot more than the car itself. Some, like towbars, will be value for about four years,” he says. “A good option will add value for up to 10 years. Then it becomes irrelevant.
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