Ten things to boost your trade-in value
Independent advice desk
Thousands of you are going to upgrade your car in the New Year. You have an idea of your budget and what you want. But what about your trade-in, the car that has got you this far?
You probably have a rough idea of what it is worth. But 'rough' could equate to plus or minus hundreds of euro; maybe even more.
Time and again people over-estimate the value of their own car and it can lead to some heated discussions in the showrooms. The reality is that the monetary value that you, and indeed the dealer, places on your car is a bit of an inexact science.
Trade-in values are cloaked in margins, bonuses, and can be dressed up or dressed down depending on what you are buying. The only truly agreeable price is what the car will make when it is retailed back into the market and even then it is a complex web of calculations.
We always advocate not letting the trade-in value dominate your thinking too much and advise you to focus instead on how much money the dealer wants from you to buy the newer car - the cost of change.
But there are things you can do, or use to your benefit, with your trade-in, to lower that cost of changing.
Here are 10 things we think will help:
1 Condition of car:
A car in great condition should attract a premium. The corollary is also true; that a car in average or poor condition will take some sort of financial hit when it is being traded in.
If the latter sounds like your car then unfortunately there is not much you can do about it now. This one requires prevention rather than cure. Keep the car in proper mechanical order and free from nasty scrapes and bumps and you stand a much better chance of reducing your cost of change. You can do something about the inside though.
Spend some time, effort and maybe a few euro to have it in the best possible condition. Make it look and feel like a well-minded car.
Apart from age, mileage usually has the biggest influence on value. Take two similarly-aged vehicles in much the same condition, one with a standard 50,000 kilometres and one with 85,000 kilometres.
The difference can be as much as €1,500, depending on the car. If you know you'll put up a lot of miles, try hard to buy something with low numbers on the clock to begin with. Even if you cover small mileage, opting for a car that hasn't been driven much means you are always going to get more for it when trade-in time comes. You will pay a premium to buy it but it will hold value better too. But also remember that if your car is in good condition, has an unbroken service record and is known to your dealer, the mileage will not be as dominating a factor. Which would you prefer? An 80,000km car in great nick or a 50,000km one that has been driven like a rented mule and only sporadically serviced?
This is a funny one. Typically, higher specification cars are more sought after but that does not mean they hold all their initial price premium. However, if you have a car with a base-line level of trim in a market where more models are of a higher grade then it can impact on your trade-in price. Some specification is an entirely personal choice. Massage seats, for instance, carry little if any value when you trade the car back in. A typical trade saying: "It will sell quicker but not for more" comes to mind. So, be careful with what you opt for in your next car because you might not see a return on it down the line. Other things, like leather, fancy infotainment systems and parking sensors tend to carry more weight than subtle styling upgrades.
4. The time of year:
Most cars being traded in at the tail end of the year are likely to be targeted for sale early the following year and so trade-in values tend to reflect this. However, seasonal impacts on trade-in values aren't confined to the end of the year. Summertime can help the value of coupés and convertibles (depending on what type of summer we get) and harsh winters can be friendly to values of four-wheel-drive SUVs. As well as all of that, dealers are given targets for each year and if you find a dealer trying to make their target you could discover your cost of change is helped accordingly. Oftentimes you can benefit from waiting a little before buying new or newer. When the glut is gone and the rush over, you stand a good chance of driving a better deal for yourself.
5. General supply and demand:
Owing to a number of years of poor new-car sales, stock availability of good-quality used cars has been paltry. As a result, demand for good, low-mileage diesels has consistently outstripped supply in recent years and with the poor Sterling exchange rate, dealers have not been able to supplement shortfalls in stock with imports. It doesn't matter whether you are selling your car, house or any other item; if the supply is low and demand is high then values rise. The good news is that supply is still low so if you are changing car now or early next year the likelihood is that you will benefit from a better trade in value/cost of change.
A good three or four-year-old diesel in decent nick and with a proper service record could earn you a lot of euro on a trade-in against a new car. It just goes to show that if you buy something decent and mind it well, it will always pay you back. We keep saying that, as you have probably already noticed.
6. Main franchise v other dealers:
Typically speaking, dealers offer slightly more attractive trade-in values for vehicles within their own stable. A Golf in a VW dealer is usually taken at a higher cost than in a Toyota dealer and vice-versa. This is not a strict rule but more of a general trend. A helpful tip while shopping for a used car when you have a trade-in from a different make is: 1. Source the new/newer car in a franchised dealership for the brand you are trading in. They are likely to be more amenable to your car.
2. But they can't quite get the same value as a franchise dealer for the car you want to buy. So you should benefit. It's as close to win-win as you can get.
7. Fuel type and location:
Although petrol cars are making a comeback, some parts of the country are a little more accepting of certain vehicles with petrol engines than others. For instance, compact executives (BMW 3-series, Audi A4 , etc) and coupés from premium brands generally go better in cities. Trading a petrol coupé into a predominantly saloon, diesel-buying territory can affect your trade-in value. We know of some areas where the saloon variant of a predominant selling hatchback can be equally, or even more, sought after. These are not usually enormous differences but it can pay to shop around. It's all about matching your car to the market. Test the water a bit from home to get a better fix on your car's worth.
8. Offers from the manufacturer:
The value of your trade-in can be affected depending on the scope and scale of a new offer or incentive from a manufacturer. If there are thousands of euro off the new price then the implications for fresh used cars, demos and one-year olds is greater than it is for two and three year olds. However, this is all relative as your car is unlikely to fall by the full amount of the new price incentive and so whatever you "lose" off your car's value, you more than make up for in the saving on the new price.
9. Sell your own car separately:
Remember the whole trade-in gig is about you spending as little as possible to change cars. It may seem ridiculous to suggest that selling your car separately for a 'lower' price and then buying new/newer as a cash customer could save you money. It most certainly could. Dealers can do you a far better 'straight-buy' deal, especially if your model is quite old, because they don't have to worry about disposing of something with 170,000km on the clock. It's a much cleaner operation. Don't get hung up on what you are getting for your car. If the overall cost of change is lowered by selling it separately that is the route to go.
10. Bargain... but don't overdo the haggling:
You would be surprised at what a bit of skill at bargaining can do. Never take a first figure. There is always a bit of 'give'. If a dealer sees you are genuinely interested, he or she will do all in their power to hold onto you and strike a deal. You will have done your homework before going near the dealership and they know that. So you are really fine-tuning the money aspect as much as anything else. Just realise too that the dealer has to turn a few euro; there is a limit to which he/she can cut.
A little bit of goodwill is worth a lot of money if your car ever runs into trouble. But a nice, solid bit of bargaining will still yield a nice dividend. Good luck and safe driving.