Perhaps you’re presently trying to sell your car. You’re probably asking the question “How much is my car worth?”
The used car market is a tricky one, especially when it comes to determining the value of a vehicle. This can be difficult, because valuation is subjective. What you’re willing to accept might not tally with what the buyer is offering, and therein lies the problem.
Most consumers have admitted to not knowing the difference between the guideline value vs market value of a car.
Valuation determines how fast you want to sell your car, and for how much. Would you rather sell your car quickly, or are you willing to wait for the right price that matches what you're sure the value is? After carefully considering these questions, your next move should be about finding the balance.
How do you find the balance between the purchase price, asking price, your listing price, and how long it will take your car to sell? This article is an in-depth look into the factors that positively and negatively affect a car's ,as well as all you need to know about the retail value and market value.
What Is The Guideline Value (Retail Value) Of Your Car?
The retail value of your car, simply put, is a reflection of the average price at which a particular car sold recently.
Most major second-hand car dealerships are linked to a central database like NADA or Kelley Blue Book. With appraisal sites and tools like ours, you can get an accurate and instant valuation of what your car is worth.
These websites inform you how much the average guideline value is for every car make and model. They also indicate sales volume, as well as recent trade values.
What Is the Market Value Of Your Car?
Once you’re ready to jump into the used car market, it’s absolutely important that you know your car’s value.. The market value of a car is commonly defined as the price a willing buyer is prepared to pay for a vehicle.
By default, this means that the prices and value can differ in terms of condition, car type, car manufacturer, and other criteria.
To determine the market value of your car, there are several factors to look out for such as the retail prices charged by dealerships, the retail value for individual sales, and the wholesale prices for trade-ins.
The second you get a good understanding of your car’s value, setting a realistic selling price becomes easy. Your negotiations are backed by your research knowledge.
This knowledge is subsequently useful for you when you are buying, selling, or dealing with car insurance and loans.
Getting an accurate price with online valuation tools can prove to be quite a task. They’re much better at providing estimated values. Setting an unworthy value or unrealistic price for your car can lead to depreciation as well as other costs that will cumulatively result in a drop in value.
Guideline Value vs Market Value: Which Do You Need?
In the used car market, a pretty common problem is the value and price problem. It’s quite easy to set an unrealistic price since most people tend to overvalue their cars.
It’s important that you determine the value of your car correctly, as this helps you set an accurate price, which makes it easier to get it off your hands quickly.
Both the guideline value and the market value are important when dealing with used cars. The guideline value gives you an estimate of what to expect, while the market value sets a price for you.
What Are The Factors That Determine A Car Valuation?
Car valuations don’t focus so much on the manufacturing year of your car but rather on the mileage. A new car model can have more mileage than an older model. The more miles traveled by the car, the lesser the value. Most buyers prefer a car with lower mileage.
Model and Make
The model and make of a car are important factors that determine how much a car is worth. Popular cars tend to hold more value. This is because they are reliable, affordable and always in high demand. There are some specific models from certain manufacturers that rank pretty high too. For example: theToyota Corolla.
Accident And Repair History
Another major factor that affects a car's valuation is the repair and accident history of the car. Has your car previously been involved in an accident? Does your car have any recurring problem that requires continuous repair?
Questions like this go a long way in determining the value. Your car maintenance history can also help determine your car's health, thus affecting valuation.
Age is another important factor when it comes to determining the monetary value of your car. Old cars with high value are mostly vintage or classic cars.
There are some car colors that are highly in demand, and that's because they’re conservative colors. These colors include white, silver, and grey. Odd colors such as orange and yellow might affect the value of the actual transaction.
For 20th century cars, automatic cars are quite more valuable than manual transmission cars. Manual car prices can differ slightly in price depending on their manufacturers.
Market conditions and demand are major factors when it comes to valuing used cars. The market demand is influenced by factors such as location, time, car manufacturer, color, car type, and other factors. Cars that are high in demand tend to be more expensive.
The Importance Of Guideline Value vs Market Value
Setting an accurate price for your used car becomes so much easier after proper research. Once you understand the types of car valuation in the market and factors that determine a car's value, you can then easily sell at the best price.
Using popularly used car tools is only helpful in providing an estimate, which is the guideline value. How much a buyer is willing to pay is what sets the market value. This is a major difference between guideline value vs market value.