Home > Uncategorized > How the Color of Your Car Can Affect Its Resale Value

Comments 0 Comments

It’s common knowledge that a car’s value begins to depreciate as soon as it leaves the sale lot. But did you know its color can affect its resale value as well?

According to a new study by iSeeCars.com, an automotive data and research company based in Boston, color plays a huge role in determining a car’s retained value.

To conduct the study, iSeeCars.com analyzed more than 1.6 million used 3-year-old cars (model year 2013) of all colors sold between June 1, 2015 and June 30, 2016. It then calculated each cars’ depreciation over three years by comparing the average listing price to the average MSRP (adjusted for inflation) for each car color and body style/target market. Any colors with fewer than 1,000 cars, as well as colors and body styles/target market segments with fewer than 30 cars were excluded.

As iSeeCars found, the average car depreciated 29.8% over the first three years of ownership, while orange- and yellow-colored cars depreciated the least of any color (27.4% and 26.2% less than the average car, respectively). At the other end of the spectrum were beige- and gold-colored cars, which depreciated the most — 4.8% and 12.5% more than the average car, respectively.

You can see the average three-year depreciation rate for cars by color below.

Screen Shot 2016-08-15 at 10.16.20 AM

Charts via iSeeCars.com

Apparently, popular car colors like white, gray and black depreciated closer to the average car. “Because buyers shopping for such colors have a lot more choices, sellers may not have as much pricing power,” Phong Ly, chief executive of iSeeCars.com, explained in a press release. Conversely, consumers with an orange, yellow or green car may have more luck because those are more unusual colors.

Interestingly, while the average 3-year-old car takes 43.9 days to sell, the average for orange cars is 44.1 days and 44.9 for green cars. “In fact,” according to the release, “cars of almost any colors except beige sell within 6 days of the average car.”

Screen Shot 2016-08-15 at 12.23.55 PM


Need a Ride? 

With new cars losing anywhere between $3,000 to $5,000 the moment they drive off the lot, it’s no wonder many people find buying a car to be such a hassle. Just think, if you’re financing the car with an auto loan, that depreciation could mean you’re suddenly “upside-down” on the loan, owing more than the car’s even worth.

Of course, there are ways to get around the problem. You can research online at sites like Kelley Blue Book and Edmunds, which offer free information on models, safety and prices, and you can comparison shop for cars in your price range. Once you’ve got the right car in mind, you can dig up its history online. (Just make sure to grab its VIN number beforehand.)

Remember, buying a car is one of the biggest purchases you’ll make, so take the time to do it right. It can take minutes to set your eyes on a set of wheels, but paying for it is a whole other story. Whether you choose to lease or finance, you’ll want to make sure your credit’s in tip-top condition before you apply, as this will determine what terms you may qualify for. You can view two of your credit scores, updated every 14 days, for free on Credit.com.

Image: Deklofenak

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team