Car Depreciation in Australia: How Much Does Your Car Lose?
The moment you drive a new car off the lot, it loses value. But how much? We analysed depreciation data across 1,000+ vehicles to show you the real numbers. and which cars hold their value best.
Average Depreciation by Year
| Year | Average Value Retained | Loss on $50k Car |
|---|---|---|
| After 1 year | 80% | $10,000 |
| After 2 years | 70% | $15,000 |
| After 3 years | 60% | $20,000 |
| After 5 years | 45% | $27,500 |
| After 10 years | 25% | $37,500 |
The average car loses 55% of its value in 5 years. That's $27,500 on a $50,000 car. more than fuel, insurance, and servicing combined.
Best Value Retention by Brand
| Brand | 5-Year Retention | Why |
|---|---|---|
| Toyota | 55-65% | Reliability reputation, strong demand, limited discounting |
| Suzuki | 50-58% | Low purchase price means less dollar depreciation |
| Subaru | 50-55% | AWD demand, loyal customer base |
| Hyundai/Kia | 48-53% | Improving reputation, good warranties |
| BMW/Mercedes | 40-48% | High RRP means big dollar losses, expensive maintenance deters buyers |
| Chinese brands | 35-45% | Unproven long-term, uncertain resale market |
Best Value Retention by Body Style
- Utes. 55-65% after 5 years. HiLux and Ranger lead the market
- SUVs. 45-55%. RAV4 and CX-5 are the standouts
- Hatchbacks. 40-50%. Corolla and Mazda3 hold best
- Sedans. 38-48%. Declining demand hurts resale
- Luxury. 35-45%. High RRP means big dollar losses even if percentage is decent
How to Minimise Depreciation
- Buy the most popular colour. white, silver, and grey resell fastest in Australia
- Keep km low. every 10,000km above average drops value 2-3%
- Service on time. full service history is worth $2,000-5,000 at resale
- Buy a 1-2 year old demo/used. let someone else eat the first-year depreciation
- Avoid heavy options. a $10k options package rarely adds $10k to resale. Stick to popular specs
- Buy Toyota. not exciting advice, but statistically the safest bet for value retention
The Sweet Spot: Buy at 3 Years, Sell at 7
Depreciation is steepest in years 1-3 (you lose 40% of value). From years 3-7, it flattens to ~5%/year. Buying a 3-year-old car and selling at 7 years means you only experience the flat part of the curve.
EV Depreciation: The New Wild Card
Electric vehicles are depreciating faster than ICE cars in 2025-2026, driven by frequent manufacturer price cuts (especially Tesla) and rapidly improving new models that make older EVs less desirable.
| EV | 3-Year Retention | Notes |
|---|---|---|
| Toyota RAV4 Hybrid | 65-70% | Best in class. hybrid demand strong |
| Hyundai Ioniq 5 | 55-60% | Stable, no sudden price cuts |
| Tesla Model 3 | 60-65% | Volatile. dependent on Tesla pricing |
| MG4 / BYD Dolphin | 50-55% | Uncertain. Chinese brand resale unproven |
Exception: Toyota hybrids are actually holding value better than their petrol equivalents because demand for fuel-efficient used cars has increased. A used RAV4 Hybrid sells faster and for more than a used RAV4 Petrol.
Colour Impact on Resale Value
| Colour | Resale Impact | Time to Sell |
|---|---|---|
| White | +2% premium | Fastest (1-2 weeks) |
| Silver / Grey | Neutral | Fast (2-3 weeks) |
| Black | Neutral | Fast (2-3 weeks) |
| Blue | -1 to 2% | Average (3-4 weeks) |
| Red | -1 to 3% | Slower (4-6 weeks) |
| Yellow / Green / Orange | -3 to 5% | Slowest (6+ weeks) |
White outsells all other colours combined in the Australian used car market. If resale value matters, choose white, silver, or grey. especially for SUVs and utes.
How Mileage Affects Value
| Annual km | Resale vs Average | Impact on $40k Car |
|---|---|---|
| Under 10,000 | +2% | +$800 |
| 10,000-15,000 | Average | — |
| 15,000-20,000 | -5% | -$2,000 |
| 20,000-30,000 | -12% | -$4,800 |
| 30,000+ | -20% | -$8,000 |
Every 1,000km above the 15,000km/year average costs approximately $200-300 in resale value. High-km drivers should factor this into their TCO calculations. a cheaper-to-run car might cost more overall if it depreciates faster.
New vs Used: The Depreciation Maths
Worked example on a $50,000 car:
| Scenario | Buy Price | Sell After | Sell Price | Depreciation |
|---|---|---|---|---|
| Buy new, sell at 5yr | $50,000 | 5 years | $22,500 | $27,500 |
| Buy 3yr old, sell at 8yr | $30,000 | 5 years | $12,500 | $17,500 |
Buying a 3-year-old car saves $10,000 in depreciation over the same ownership period. The trade-off: the new car gets full warranty, latest safety tech, and newest features. If safety and warranty matter most, buy new. If financial efficiency matters most, buy used.
Tax Depreciation for Business Use
ABN holders can claim car depreciation as a tax deduction. The instant asset write-off threshold (currently $20,000 for small businesses) allows immediate deduction of the car's cost. Novated leases also use depreciation to reduce your taxable income. This is not financial advice. consult your accountant for your specific situation.
Compare Depreciation for Any Car
Our Depreciation Chart on comparison pages shows projected value over 5 years for any combination of cars. See exactly which car loses less money.
Compare these cars yourself
200+ specs, fuel costs, safety ratings, braking distance, and speed vs range calculator.
Disclaimer: All information in this article was believed to be correct at the time of publishing (18 March 2026). Prices are manufacturer recommended retail prices (RRP) and may vary by state, dealer, and options. Specifications, government incentives, and rebates can change without notice. Always verify details with the manufacturer or relevant authority before making a purchase decision. Running cost estimates are based on average Australian driving conditions at 15,000 km/year. All opinions are editorial and independent. CarSorted does not accept payment for recommendations or rankings.
Published by CarSorted Editorial Team · 18 March 2026
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