How much does a car depreciate in the UK?+
A typical new UK car loses around 20-30% of its value in year 1, then 10-15% of its remaining value each subsequent year. After 3 years, a £25,000 car is usually worth £14,000-£17,000; after 5 years, £10,000-£12,000. Premium and well-retained brands depreciate slower; cars with weak demand or high mileage depreciate faster.
Why does a car lose so much value in the first year?+
Two reasons. First, the moment a new car is registered it stops being new, which immediately closes off the new-car market and shifts it into the used-car market where prices are lower. Second, the new-car market has VAT, dealer margin and registration costs built into the headline price; the used market doesn't. The 15-30% drop in year 1 mostly reflects that one-time transition, not real loss in usefulness.
Do high-mileage cars depreciate faster?+
Yes. UK used-car pricing guides apply a per-mile deduction over the 'standard' mileage for the car's age — typically based on 10,000 miles/year. A 3-year-old car with 45,000 miles will sell for noticeably less than the same car with 30,000 miles, even in identical condition. The calculator above bakes this in: increase the annual mileage input and the projected value drops.
Which UK cars depreciate the slowest?+
Well-retained brands tend to be Toyota, Honda, Porsche, Lexus, and Land Rover (particularly the Defender). Specific models that historically hold value well include the Toyota GR Yaris, Honda Civic Type R, Porsche 911, and most Land Rover models. EVs are increasingly competitive — Tesla Model 3 and Y retain value better than most legacy car brands' equivalents.
Which UK cars depreciate the fastest?+
Cars from premium German brands at the entry trim (basic 3 Series, A4, C-Class) tend to depreciate faster than people expect because the buyer base wants high-spec models. French and Italian budget brands often depreciate faster than equivalents from Japanese and Korean brands. Electric cars on outdated battery tech also depreciate quickly as newer models with longer range arrive.
Does service history affect depreciation?+
Significantly. A car with a full main-dealer service history typically sells for 5-10% more than the same car with patchy or non-main-dealer history. Keep every receipt, ideally use a single garage (main dealer or recognised independent), and don't miss services. The cost of a good service history is recovered at resale.
How accurate is this depreciation calculator?+
It's a planning estimate, not a valuation. Real resale value depends on the specific make, model, condition, mileage, location, time of year, and the wider used-car market — which can swing 10-20% on macro factors like supply chain shortages or interest rate cycles. Use the calculator to compare scenarios (low vs high mileage, longer vs shorter ownership), not as a price quote for your actual car.
Should I worry about depreciation or just drive the car?+
If you plan to keep the car for 10+ years, depreciation barely matters — by the time you sell, the car is worth a fraction of new and the price difference between models has compressed. If you replace cars every 2-3 years, depreciation is the largest cost of ownership and worth optimising. PCP buyers especially feel depreciation directly: the GMFV (balloon) is the lender's depreciation forecast, so a slow-depreciating model means lower monthlies.