Car Depreciation Calculator

New cars typically lose 15-25% of their value in the first year and around 10-15% each subsequent year. After 5 years, most vehicles have lost 50-60% of their original value. The first year's depreciation is steepest because the car goes from 'new' to 'used' the moment you drive it off the lot.

Key factors include the brand's reliability and resale reputation (Toyota and Honda typically depreciate slower), mileage (higher mileage accelerates depreciation), condition, color, optional features, fuel efficiency, and whether the vehicle is new or used. Luxury vehicles often depreciate faster in dollar terms but slower in percentage terms after year 3.

Traditionally, Toyota Tacoma and 4Runner, Honda Civic and CR-V, and Subaru Outback consistently top the best-resale-value rankings. Electric vehicles have shown more variable depreciation depending on the brand and changing technology. According to iSeeCars and CarEdge data, trucks and SUVs generally retain value better than sedans.

The best value is often found in vehicles that are 2-4 years old. The previous owner has absorbed the steepest depreciation, but the car still has significant useful life remaining and may still be under warranty. Models in their second or third year also have known reliability records you can research.

The residual value is the estimated value of the leased vehicle at the end of the lease term, set by the leasing company. A higher residual value means lower monthly lease payments because you are only paying for the depreciation during the lease period. This calculator can help you estimate whether a lease residual is realistic.