Whenever we talk about cars, essentially we talk a lot about new cars and their market across the world but often what goes missing is the resale car section, though it is a major chunk holder in the automobile sector. If we consider the resale car market alone, the numbers stand equal to new car sales and in some quarters even exceed that of new cars. This segment is popular among not just one consumer group but throughout the whole automobile customer world. In the resale segment the small SUVs and crossovers are extremely popular.
Going by the reports from Edmunds.com, the market cap for resale compact SUVs has doubled in comparison to that of the new car market, and it is now the fourth most popular type of vehicle among midsize cars, small cars and pickup trucks. While Edmunds.com points out that small SUVs offer things like space, price and fuel economy that lure the buyers, there’s another reason to love small SUVs: Their resale values tend to be better than the resale values of other vehicle types.
While buying a new car, a smart buyer would also go for a car that would hold its value over a period of time besides the swanky in-car features. A couple of benefits of doing so are: with better resale value, you get more money when it comes to selling or trading off your car, plus when you finance a new car, choosing a car that holds on to its value also protects you from owing more than the car is worth. According to Edmunds, the five compact SUVs with the best resale value sails with a resale price tag, well above the median of resale value for the car market as a whole. These high resale values not only help in our quest to buy a small SUV and resell it someday, but they also help lower the lease payments if we lease out a compact SUV.
The crown holder in this segment
The Honda (HMC, Financial) CR-V, which is currently the top-ranked compact SUV, has the best resale value among compact SUVs in the market, retaining 50.7% of its purchase price over a period of five years. With such a value retention capacity, it’s an attractive proposition to buy a new CR-V, drive it for five years and get half of the money back when you trade it in or resell it. If you bought a new CR-V for $25,000 and get half the purchase price back when you trade it in, that effectively lowers your outlay for the SUV to just $12,500 – not a bad deal for the top-ranked small SUV from Honda. Let us take a quick look at the crown holder in comparison to its near peers.
The crown holder vs. its near peers
Coming in right behind the CR-V’s resale value is the Toyota (TM, Financial) RAV4. This Toyota marvel retains 48.6% of its purchase price, sporting a new-car price tag of $24,950, over five years which is not very far from CR-V’s 50.7%; hence it holds a good bargain as well.
The Subaru (FUJHY, Financial) Forester holds on to 47.1% of its new car price tag at $22,195
and the Ford (F, Financial) Escape earns you back 45.7% of your new car purchase price of $22,610 on reselling it after driving it for five years.
The Nissan (NSANY, Financial) Rogue and Mazda CX-5 stands at the fifth and sixth position amongst the compact SUVs for resale value, holding onto 43.5% and 43.2% respectively, of their original purchase prices.
Most of these small SUVs also top the charts of the compact SUV rankings.
Making the smart choice
Whether you are a rookie or an experienced buyer or a car crazy buyer – a fact that stands as the universal truth is that it is a depreciating asset which without doubt adds qualitative value to your personal portfolio, but also adds to the depreciation of financial value of your personal portfolio.
Hence it’s important to be smart with your money and think about the long term – not just your monthly EMI payment – when you’re buying a new car. By considering a compact SUV with great resale value, you’re more likely to earn back more from your investment when it’s time to get another new car.
