A car is commonly considered a depreciating asset, so many people think twice before purchasing a car. However, there are chances that your car might be worth a lot more than what you bought it. In recent years, the used car market has experienced a price surge. Also, the best-selling car models most coveted by buyers are mostly not found in the dealerships. This has created an unusual turn of events where used cars are gaining value.
This guide will tell you everything you need to know about the increasing value of your car and how you can capitalise on the opportunity.
The Current Scenario
As the inventory crunch issue is worsening at the dealerships, the cost of used cars is increasing. In the case of recently bought cars, their current market value is even more than the price at which they were bought.
Auto manufacturers are struggling to produce vehicles and meet the demands of car buyers post the pandemic. Hence, vehicles are scarce everywhere. Hence, more and more people are drawn to the used car market. Even these markets have limited options as car owners are unwilling to sell the car models in high demand.
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Reasons For Increasing Value
According to industry data, the sharp increase in resale values is erasing years of depreciation on many older models and prompting others to improve in value in the months after their existence has been wiped out from the car dealerships.
The increase in the value is also a result of the revival of the economy post-pandemic. As the demand for new cars is pretty high and their supply is very low, the prices of the existing models in the market have increased considerably.
The higher prices of used cars are also impacting other areas of the auto industry, providing buyers more purchasing power when they trade in automobiles, raising the cost of auto insurance, and reducing the options available to buyers looking for cheaper cars.
In regular cases, a newly purchased vehicle loses a lot of value during the first year of its purchase, and the value keeps falling with wear and tear. However, the current trend shows that the people who have bought the 2020 models have experienced an appreciation in the value of the cars.
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Ways To Increase The Car’s Value
There are several ways to increase car valuation in India (of used cars). While the entire used car market is experiencing a surge, you can charge a better price if you know how to maintain a car. Let’s look at how you can increase the current market value of your car.
The budget for keeping up with the existing condition of the car depends on its make and model. For instance, hatchbacks require a lesser amount of maintenance as compared to sedans. Also, maintaining a BMW will cost a lot if you want to maintain it. However, you can save money on big repairs if you spend money on routine maintenance.
Before you buy a car, decide how much you can spend on its maintenance. If you plan to drive the car regularly, you must keep more money aside for maintenance.
The tires are the soul of any vehicle. Hence, you must have properly inflated tires at all times. Also, try to have good fuel mileage if you want the value of your car to appreciate. To prevent a car’s tires from wearing out prematurely, rotate, balance, and align your tires periodically. Investing in new tires will help you achieve a higher trade-in value for your automobile if you decide to sell it if your tire tread is starting to look a little bald.
Make Small Changes
You can make a few changes to your car if you want to extend its life and increase its lifetime value. You can frequently change the car’s battery and engine oil. You must also keep changing your coolant, transmission oil, etc., so the car keeps moving smoothly.
Keep It Shining
Cars experience wear and tear throughout their use. Hence, they lose the shine in the process. You must get your car serviced and cleaned to look brand new. You should also vacuum the interior and clean the windows regularly.
If you want an increased value for the car, you will have to spend time and energy on its upkeep. It is important to keep the car clean and in good condition if you want to make the most out of turn in the market.
The auto industry is attempting to make up for lost vehicle production in the wake of the twin blows of widespread factory closures early in the pandemic and a subsequent computer chip shortage that, over the past year, forced car plants to idle. According to analysts, the continuation of the trend will depend on dealers restocking their inventories of new cars and supply-side limitations easing.