Drive a car off the dealer lot and suddenly the car you bought is worth thousands less. Why is that?
If you’ve driven the car off the lot, you’ve locked in that purchase as it is. You picked what features it has, the color, the price to some degree… Someone buying it used doesn’t have that option, and that option is valuable. Part of the cost of the car is paying people for that service!
Car depreciation also occurs due to wear and tear. While modern cars are quite well-built and durable, you never truly know what the history of a car is, even if you get a history report from a reputable reporting agency. That becomes a risk that reduces the value of the vehicle. Slow wearing things like bearings, brake pads, transmission fluids, and comfort technology also don’t always show early stages of wear, adding to the risk.
Technology ages fast, and every model year ages technology more than you think! Even if you purchased car A last year, and car A has the same tech available this year and last year, car B might have new technology features that makes your car outdated, and this year’s car A may even reduce its price to compete!