It’s no secret that all cars start to depreciate in value the second you drive them off the lot. Within the first year of ownership, most cars lose about a fifth of their value - and then another 10% every year after.
These are just the facts of car ownership. But are there any exceptions? Are there any cars that retain their value? Or better yet, are there any cars whose value actually increases over time?
There are, in fact, a few factors that can cause a car to retain its value better than most. That’s not to say these cars don’t depreciate. But some cars do enjoy a gentler depreciation curve than others.
And there are some cars whose value actually does increase over time. But as you’ll see below, that process can take a very, very long time.
A Reputation for Reliability
Some cars depreciate slower because they have earned a reputation for being reliable. When a make and model is recognized for unusual durability and longevity, it begins to enjoy an increase in demand and therefore an increase in value.
When the buyer expects a car to last for a long period of time, they are willing to spend more money, knowing that the investment they are making will likely save them money over the long run.
A good example of extreme durability comes from the Mercedes-Benz OM617 engine that was sold from 1974 to 1991. Cars with this engine have earned a reputation for being passed down through generations!
Obviously a 40 year old car will have endured some depreciation. But while there are relatively few other cars on the road from this era, there is still a healthy market for cars with the OM617 engine, and they continue to fetch surprisingly high prices today.
These are the fun and fancy cars you see cruising down the street on a nice day, or camped out at the weekend car show.
Think of the 1961 Ferrari GT California Cameron’s dad owned in Ferris Bueller’s Day Off. “My father spent three years restoring this car. It is his love, it is his passion.”
These cars are unique and historical. They made a wave in the industry not for the way they run or their functionality, but for their personality and appeal, and their popularity and je ne sais quois.
If your car fits under one of these categories, then you’ve got yourself something special and it’s one of the few cars out there that defies the law of depreciation.
Rare and Hard-to-Find
Some cars are worth more just because there aren’t many of them out there. The laws of supply and demand apply to cars, just like everything else.
An extreme example comes from the 2013 Lamborghini Veneno. Only 5 of these were made, and today each of them is worth about $4.5 million.
Condition and Ownership
Whether we’re talking about a classic collectible or a plain old daily driver, condition and ownership always have an impact on a vehicle’s value.
Low mileage, a spotless interior, and a low number of previous owners are all factors that can bump up the price a buyer is willing to pay. If a car has had only one owner, that can have a significant impact.
But regardless of the condition of a car, it will still be subject to regular depreciation. While it’s value will continue to decline over time, it will decline less than a similar car that hasn’t been cared for as nicely.
So, Can a Car’s Value Increase Over Time?
The answer to the question we originally asked is technically, “yes.” But these cases are so few and far between that they’re virtually impossible to predict.
As a general rule of thumb, you should assume that every car will depreciate over time. There’s just no way around it.