When the time comes to upgrade your car, it makes sense to consider the value it will hold. It’s rare to sell your car for more than you paid for it – cars aren’t like the Auckland housing market – but some vehicles retain more value than others. But why?
Legacy factor
Manufacturers and models that need little introduction are always strong contenders when it comes to retaining value. Often it’s because they have a proven track record of reliability and trouble-free motoring and a strong brand identity that has translated in to a great reputation.
Investing in a respected brand is a smart way of preserving your dollars. Buying a model with a similar spec but that’s been made by a lesser known manufacturer may well save you on the initial outlay, but it’s likely that its value retention will be weaker.
Looking at buying trends will help you to identify some of those high performers. For example, in 2016 the Ford Ranger was the top selling new vehicle in New Zealand while Toyota claimed three spots in the top five with the Corolla, Hilux and RAV4. These two brands shifted more cars than the rest of the top 10 combined so they do, to some extent, reflect Kiwi tastes. The passenger car market is boosted by the number of used imports which arrive each month and this influx of vehicles does shake up the mix of models sold.
Classics
It’s not easy to identify a vehicle that’s destined to become a classic because, more often than not, they gain their status long after they’ve first been introduced to the market. Taking a look at what’s on the road today won’t cut it, but bear in mind that most classic vehicles weren’t considered to be special when they first appear in the car yard. In 2016, a 1974 Volkswagen Beetle sold for just shy of NZ$63,000 at an auction in Denmark. It had travelled 90kms over four years and then parked in a barn for 40 years before being rediscovered.
The lesson? If you think you’re on to a winner, don’t be quick to sell and consider keeping it as an investment. Although, you should consider the cost of doing this – classic cars become more difficult to keep on the road over time due to the limited availability of parts and finding the specialist expertise required to service them.
Scouring broad and specialist listings by age of vehicle and cost is a good indicator to classic car status. A classic car club is in the best position to advise of its potential value.
Limited release
Last year’s New Zealand launch of the Ford Mustang GT was proof of the popularity of a limited release. When it was announced in 2015 that about 300 forward offers were placed ahead of the iconic sports car’s arrival, it created an almost unprecedented wave of excitement among enthusiasts. A household name, boosted by the reputation of its manufacturer, its sales success and legacy overseas, the Mustang dominated many end of year best of 2016 lists. The Mustang earned a disappointing ANCAP 2 star safety rating which was shared post-launch, but this won’t have a significant impact upon its future resale value because it’s already considered a classic.
Specialty vehicles
When cars clock up the distance and start to nudge 100,000km, its value typically dips. However, campervans usually retain strong value, even after long distances clocked up poking around the country.
While campervans aren’t considered classics because they’re modified as a speciality vehicle, their lack of availability makes them a precious find. You can sometimes see them being sold by rental companies nearing 200,000kms on the clock, and they still fetch a handsome sum. However, they start off with a higher value in the first place, so that helps!
Some specialty off-road vehicles can also hold their value well if the model is synonymous with its capabilities or is historically popular. Take the 1970s series Toyota Land Cruiser for example. This model has always been popular with Kiwis and many of its design aspects have not changed a great deal since its introduction in 1984.