Buy Which Year/ Mileage/ Model Car For Best Resale Value in 1 Year?

August 6, 2024 8:23 AM

I recently asked how to get a car for one year of use, and one suggestion (thank you) was to buy from and sell back to Carmax. If I went this route and bought a vehicle from them with the intention to sell it back to them 12 months later, what is the sweet spot for year, mileage and model to minimize the difference between cost and resale value (let's assume <10000 miles over that one year)?

I'm imagining here that there's a threshold for both mileage and year beyond which resale value really drops off, and that also the used market is awash with some brands and models which just can't get shifted?

Also, the reason I'm specifying Carmax is that I will have a lease on an apartment for a year, so I'll need the car for that year but I'll also want to get rid of it as close to my departure date as possible; so I won't have time for last-minute dramas or dealership shenanigans or the like (and obviously I can't go beyond my departure date).

posted by my log does not judge to Travel & Transportation (11 answers total)

Best answer: Telling you what cars will retain value best requires a whole lot of prognostication (guessin') on our part - about what your budget is, what kind of car you want, what level of wear you'll accept, and what the market for used cars is going to look like next year.

Here's what you do. Go to Carmax, do some test drives, and get a list of the purchase price of five models and years that are in your budget and you like. Go to Kelley, and get a "my car's value" quote for the model years a year before the ones you're looking at. Next, get insurance quotes on the five you like - insurance costs can vary wildly from model to model - and total up the entire insurance cost for the year.

At the end of the day, your purchase price plus the cost of one year of insurance minus the current resale value of the prior year's version of the car is likely to be the closest thing you're going to get to what your actual cost will be.

An exception: given the rampant issues with the theft nationwide of older Kias and Hyundais that were not manufactured with immobilizer systems, it is hard to recommend a used Kia or Hyundai right now in any scenario.
posted by I EAT TAPAS at 8:56 AM on August 6 [3 favorites]

Get any common used vehicle that has already depreciated heavily but is in decent condition. It will be cheap to insure and you can be relatively confident that it will not depreciate much more in one year provided it still runs and you keep up with scheduled maintenance. If it gets totaled or stolen you'll be out less money than a costlier choice and you'll probably feel less concern about the loss.

This is not a decision you can optimize perfectly, but you can avoid poor ROI.
posted by Inspector.Gadget at 9:42 AM on August 6 [4 favorites]

Not a car expert, but a car depreciates the most when it "drives off the lot," which is to say, getting a car that's at least a few years old is going to go a long way to making sure you can get something that preserves some value. Keeping it clean and well-maintained will help too. Carfax has some suggestions of what to look for. My best generic advice would be to find a 5-10 year old Honda, Toyota, or Mazda that's in decent condition without super high miles and take care of it over the year.
posted by bluedaisy at 11:24 AM on August 6 [2 favorites]

(Oops, just realized I linked to the same thing as Inspector Gadget. It's a great round-up!)
posted by bluedaisy at 11:24 AM on August 6 [1 favorite]

Cars that drop least in value over a year will tend be the oldest ones. If I was keeping a car for a year and doing 10,000 miles, I wouldn't be too picky. I'd just find one around 10 years old with less-than-average mileage for the age, no more than one or two owners, and buy it from somewhere that gave me some sort of warranty so I can bring it back if something's obviously wrong with it.
posted by pipeski at 12:18 PM on August 6 [1 favorite]

Your main aim is to buy something that will be easy to sell and have a narrow gap between the price you pay and the price you get when selling it. Look at the most popular models and pick an older version of the cheapest one that will do the job, also try to get one in whatever the most popular colour is.
posted by Lanark at 12:20 PM on August 6

From carmax, whatever the cheapest, shittiest old Honda or Toyota they have is that doesn't make horrifying noises when you test drive it.

But... you might have trouble finding something cheap, shitty, and old enough at carmax. They market mostly newer, nicer cars like $12k and up. In your shoes I'd be looking for a true beater. Like, no newer than 2010, no more than $5k unless there's something special about it.
posted by GCU Sweet and Full of Grace at 12:28 PM on August 6

Me, I'd look at something 3-5 years old and around $20k. Auto manufacturers are really good at making sure their parts last exactly as long as the warranty. Get something you like!

Tag/title/insurance/tax will probably add up to more than the buy/sell delta anyway.

Also note you don't have to buy from Carmax to sell to them. If you have time, check out other sources like car rental agencies, they usually have a list of cars to unload.
posted by credulous at 1:33 PM on August 6 [1 favorite]

Best answer: If you go to carguru.com, you can get pricing trends for any specific make that you are considering. I took a look at the chart for a Toyota Camry and for most model years between 2009 and 2022, the year to year drop in price is 10-11% (range 5.18 - 11.95). When I was considering buying used Toyota a few years ago, I came to same conclusion - the drop in price to fairly linear (as a %) as long as the car is at least two years old. More than 10 years old, I think the data gets sparse enough it is hard to tell how much as a trend and how much is the small number of data points.

So, if you stick to very common and reliable used cars like Toyotas and Hondas, there is not going to be a sharp difference in depreciation from one model year to the next.
posted by metahawk at 1:56 PM on August 6 [1 favorite]

Carmax has carrying costs and operations and marketing expenses. If you bought a car at Carmax today and tried to sell it back to them tomorrow, you're going to take a minimum $3k hit. Unless tomorrow someone announces, "All Car Xes will explode after 5 years", no single car (that is sold by Carmax in the first place, looking at you Maserati and Alfa Romeo) is going to be better or worse over such a short timeframe.

You'd probably do better to call Enterprise and rent a car for a year.
posted by Huggiesbear at 1:56 PM on August 6

Your previous question mentions needing the car for ski and hiking trips; driving on mountain roads in snow and mud conditions, or off-roading, narrows the list of potential vehicles. Besides CarMax, you can buy (and later sell back) rental fleet cars. The big three are Hertz, Enterprise & Avis; these are popular, well-maintained makes and models.
posted by Iris Gambol at 4:07 PM on August 6 [1 favorite]