Car depreciation calculator
A car loses a percentage of what it is still worth each year, so the drop is steepest at the start. Depreciation is usually the largest cost of owning a car and the one owners leave out of their sums.
- Value lost
- $130,061
- Share of the price lost
- 52.0 %
- Lost in the first year
- $50,000
- Average per year
- $26,012
- Average per month
- $2,168
- Per kilometre driven
- $1.73
- Share of value retained
- 48.0 %
The formula
Value after n years = price × (1 − first-year rate) × (1 − later rate)^(n − 1). The loss is the price minus that value.
Worked example
A 250,000 car losing 20% in year one and 12% a year after is worth 119,939 after five years. It has lost 130,061, or 52%, which is 2,168 a month and 1.73 per kilometre at 15,000 km a year.
How to use it
- 1Typical rates are 15% to 25% in the first year and 10% to 15% thereafter, but they vary widely by brand and model.
- 2Check real listings for the same model at your target age to calibrate the rates.
- 3Electric cars and models with poor reliability records have recently depreciated faster than the averages.
Questions people ask
Why is buying nearly new often cheaper?
Because the first owner absorbs the steepest part of the curve. A two- or three-year-old car has typically lost a third of its value while retaining most of its useful life.
Does mileage change the value?
Yes, sharply above the average for the car’s age. The rates here assume typical use; well above it, expect the resale value to come in lower.
Last reviewed: 2026-10-20