Whether you choose to buy a new or used car, you can count on one thing: Your ride will lose value immediately after you take possession. That’s the nature of the beast.
Unlike real estate, vehicles are bound by the law of depreciation. They are depreciating assets, meaning they lose value over time.
That said, not all cars depreciate at the same rate. Some vehicle models hold their value surprisingly well. Others depreciate rapidly, underperforming comparable cars by substantial margins.
Used vehicles rarely sell for more than their manufacturer’s suggested retail price (MSRP) for a new vehicle, commonly known as sticker price. You should never buy a new or preowned car on the expectation that you’ll be able to sell it for more than you paid. You might fetch a higher price when you forgo the dealer trade-in and sell in a private-party transaction, but it’s highly unlikely you’ll recoup your initial investment.
Factors That Affect Cars’ Resale Value
However, you absolutely can and should weigh expected resale value as you narrow down your list of vehicle candidates.
As you do, bear in mind certain key factors that unquestionably affect new cars’ resale value. These are among the most consequential.
Some makes have better reputations for durability than others. These reputations aren’t always correlated with overall vehicle quality. For instance, German makes such as BMW and Audi are renowned for the quality of their engineering while simultaneously criticized for their poor resale performance. As a general rule of thumb, Japanese makes such as Toyota, Subaru, and Honda exhibit above-average resale potential, though American makes have gained ground since the early 2010s.
Vehicle class affects resale value for multiple reasons. One important factor is geography. Sporty cars and convertibles sell better in warm climates, where they’re practical throughout the year. Rugged SUVs and four-wheel drive vehicles are more popular in colder climates.
Another key factor is fuel economy. Efficient vehicles tend to hold their value better when gas prices are high, while less efficient vehicles (which typically have more cargo space and higher safety ratings) do better when gas is cheap.
Even if it looks spotless and has a clean accident history, a high-mileage vehicle is likely to sell for less than an identical ride with half as many miles on the odometer. In fact, one of the best ways to preserve your car’s value is simply to drive it less.
4. Transmission Type
Though manual (stick shift) transmissions are slightly more fuel-efficient than automatic transmissions, they’re usually detrimental to resale value. That’s because most drivers don’t know how to drive stick, have mobility issues that make shifting painful or difficult, or simply don’t like keeping their right hands and left feet in constant motion.
5. Exterior Condition
Scratches, dings, chips, crumples, and visible rust are all enemies of resale value. A visibly beat-up car can fetch anywhere from 15% to 30% less than a pristine equivalent before factoring in potential mechanical issues and interior damage.
6. Interior Condition
Thoroughly vacuum and detail your car’s interior before listing it for sale. It’s also crucial to neutralize or at least mask lingering odors, clean plastic and vinyl, and invest in new floor mats. In newer cars, it may even be worthwhile to reupholster faded or damaged seats – a process that can cost anywhere from $200 to $500 per seat.
7. Mechanical Wear and Tear
The financial impact of mechanical wear and tear is easy to quantify in theory: If it will cost $2,000 to replace your car’s transmission, that should drop the vehicle’s resale value by an equivalent amount. However, because most buyers don’t go through the trouble of requesting a thorough mechanical inspection before the sale, the actual math isn’t always so clear-cut.
8. Accident History
Even when they appear no worse for wear, cars that have been involved in serious accidents – or, worse, floods – typically sell for less. Thanks to companies like CARFAX, car history reports are easier to come by than ever, so it’s safe to assume buyers will find out where your car has been. Though the precise hit is situation-dependent, figure a serious accident (even when fully repaired) will diminish your car’s resale value by at least 10% relative to an accident-free equivalent.
9. Aftermarket Parts and Modifications
While a well-executed home improvement project can easily pay for itself and then some, aftermarket vehicle modifications usually have the opposite effect. That’s because souped-up cars typically wear out faster than factory-original cars, especially when they’re used for racing or off-roading. Modifications that use non-OEM (original equipment manufacturer) parts can lead to a host of other issues too.
Unless you’re specifically targeting gearheads who appreciate your work and understand its implications, it’s best not to muck around too much under the hood.
Automotive technology is improving by leaps and bounds. Cars with backup cameras, hands-free parking assist, highway autopilot modes, in-cabin entertainment, and computer navigation systems tend to be more expensive than their old-fashioned peers – usually thousands or even tens of thousands of dollars more expensive. But they’re also in high demand and therefore hold value better.
When in doubt, go for a subdued look: muted colors, minimal chrome, no paint patterns or streaks. Though some buyers look for loud or offbeat color schemes, most prefer grays, whites, blacks, or unobtrusive blues, reds, and greens. This is especially true for sedan and minivan buyers, who tend to be lower-key. Sporty cars and high-performance vehicles attract more eclectic buyers seeking to stand out, not blend in.
Best Cars That Hold Value Well
Looking for a new or preowned car that’s likely to hold its value better than comparable vehicles? Start with these models.
Unless otherwise noted, these vehicles all hail from the 2019 or 2020 model year, so check back often, as the lineup is likely to change as new and updated models and trims hit the market. (Raw data compiled from Kelley Blue Book (KBB) and Edmunds.)
1. Honda Fit
- Class: Subcompact (hatchback)
- EPA MPG: 33 city, 40 highway
- MSRP: $16,190
- 5-Year Resale Value: 52.3% of total cash price
The Honda Fit is a millennial car buyer’s dream. It’s affordable, fuel-efficient, and super roomy. In fact, Fit’s single biggest selling point is probably its weirdly spacious interior. It’s made for drivers who frequently carry long-legged passengers (whether friends or rideshare customers) and for active types more likely to put down the back seat and jam skis, bikes, kayaks, stand-up paddleboards, and whatever else into the cavernous trunk. To find a more spacious car with similar reliability ratings, you need to move up at least one class level, paying thousands more in the process.
2. Honda Accord
- Class: Mid-size sedan
- EPA MPG: 27 city, 36 highway
- MSRP: $24,270
- 5-Year Resale Value: 47.9% of total cash price
Honda Accord is one of the bestselling – and best-known – mid-size sedans on the U.S. market today. Unlike most category-mates, Accord comes in sedan and coupe configurations, the latter of which is great for drivers who enjoy looking sporty without paying sports car prices. The 2017 model year saw the debut of a slew of new tech-aided safety features, making Accord a solid choice for frugal, efficiency-minded families hesitant to embrace the compact SUV revolution.
3. Subaru Impreza
- Class: Compact sedan
- EPA MPG: 28 city, 38 highway
- MSRP: $18,595
- 5-Year Resale Value: 42.4%
If you live in a cold, snowy climate but don’t want to settle for (or simply don’t need) a gas-guzzling SUV, Impreza is your ideal car. This lively compact car has the lowest MSRP of any four-wheel drive vehicle, so it’s a great compromise between safety- and budget-consciousness. Plus, it’s fun to drive and surprisingly fuel-efficient.
Also, the unusual engine configuration (boxer-4, as opposed to the more traditional I-4) produces a lower center of gravity, which is crucial in slick conditions.
4. Subaru Legacy
- Class: Mid-size sedan
- EPA MPG: 27 city, 35 highway
- MSRP: $22,745
- 5-Year Resale Value: 37.9%
Think of Legacy as Impreza’s older sibling – it’s a little bigger, a little more mature, a little more refined, and still four-wheel drive. There’s plenty of cabin space, so unless you have a big clan or need to lug around lots of equipment for the kids, Legacy is a great entry-level family sedan too.
If you’re safety-conscious, consider splurging on the EyeSight driver-assist system, which (per KBB) boasts “adaptive cruise control, pre-collision braking, lane-departure warning, Lane Keep Assist and Lead Vehicle Alert.”
5. Toyota Avalon
- Class: Full-size sedan
- EPA MPG: 22 city, 32 highway
- MSRP: $35,875
- 5-Year Resale Value: 35.1%
The Toyota Avalon doesn’t hold its value as well as the smaller cars on this list, but its durability is enough to outpace its full-size classmates. Avalon is a grown-up, refined version of the Camry, with a host of luxurious options – leather seats, fancy climate control, generous infotainment systems – that can substantially increase its sticker price.
For the safety-conscious, a rearview camera and heated outside mirrors are must-haves. If fuel-efficiency is a top priority for you, consider the hybrid version, which costs about $5,000 more upfront but averages about 40 miles per gallon.
6. Chevrolet Corvette
- Class: Sports car
- EPA MPG: 15 city, 27 highway
- MSRP: $58,900
- 5-Year Resale Value: 54.9%
The iconic Chevrolet Corvette is neither affordable (to buy new, at least) nor practical as a primary vehicle for most drivers. But for those able to afford the nearly $60,000 sticker price, it’s a thrill to drive. And the initial financial pain is made somewhat more bearable by the fact that this instantly recognizable sports car has one of the best resale values on this list. If you plan to sell or trade your Corvette before running it into the ground, that’s welcome news.
7. Toyota Prius Prime
- Class: Hybrid
- EPA Range: 25 miles battery-only, 640 miles battery and fuel
- MSRP: $27,900
- 5-Year Resale Value: 40.3%
With a total range of nearly 650 miles between battery power and fuel, this dependable gas-electric hybrid is a fantastic choice for drivers with long commutes. Its 25-mile battery-only range means long intervals between fill-ups for city-dwellers and others who stick primarily to short trips.
One note of caution: Like all hybrids, Prius Prime’s resale value is closely tied to gasoline price trends. During sustained periods of rising gas prices, this vehicle is likely to hold its value better during stretches when gas is cheap.
8. Lexus ES
- Class: Entry-level luxury
- EPA MPG: 22 city, 32 highway
- MSRP: $39,900
- 5-Year Resale Value: 35.1%
Who said luxury wasn’t affordable? Lexus ES might be the most expensive sedan on this list, but it’s a great value. It holds its value better than any other car in its class, thanks to its longtime status as one of the best luxury cars available for less than $40,000. Premium audio and leather seating both come standard, the sleek profile is a sure eye-catcher, and the surprisingly responsive handling is more Subaru than Lexus. Comparable German luxury models cost $5,000 to $10,000 more upfront, so the Lexus ES is a great choice for discerning, but still cost-conscious, buyers.
9. Jeep Wrangler 4-Door
- Class: Off-road SUV
- EPA MPG: 22 city, 29 highway
- MSRP: $31,795
- 5-Year Resale Value: 57.6%
Wrangler is another household name that’s been around since the first half of the 20th century, and the Jeep Wrangler 4-Door continues the rugged Jeep tradition. Unlike its forebears, Wrangler Unlimited has a spacious interior plenty big enough to ferry your family or crew and its gear out to its next destination.
The rough handling and engine roar take some getting used to, and the safety package remains subpar for the crossover category. That said, with resale value like this, you’ll have no trouble recouping a good chunk of your investment when it’s time to upgrade to a more family-friendly ride.
10. Toyota Highlander
- Class: Mid-size SUV/crossover
- EPA MPG: 21 city, 29 highway
- MSRP: $34,600
- 5-Year Resale Value: 45.0%
For its size, Highlander is surprisingly affordable and fuel-efficient. It’s capable of carrying up to eight people, and the hybrid version is as efficient as any midsize SUV on the market today. You can also opt for a four-cylinder gas option that’s underpowered but still quite efficient.
One notable downside is the lack of towing power. If you have a boat or ATV, you’re better off with a full-size SUV or pickup. On the bright side, there’s loads of cargo space with the third row folded down.
11. Subaru Outback
- Class: Mid-size SUV
- EPA MPG: 26 city, 33 highway
- MSRP: $26,645
- 5-Year Resale Value: 43.4%
Outback has been the family vehicle of choice for frugal, outdoorsy folks since the 1990s. With a sticker price significantly lower than most mid-size SUVs, not to mention larger gas guzzlers, its excellent resale value is an added bonus. Add in Subaru’s famed winter-weather handling and solid off-road capabilities and it’s not difficult to see why Outback inspires such loyalty.
12. GMC Yukon
- Class: Full-size SUV
- EPA MPG: 15 city, 22 highway
- MSRP: $50,600
- 5-Year Resale Value: 40.2%
Yukon is a full-size SUV with a distinguished pedigree dating back to the 1990s when it was basically a glorified, fully enclosed pickup truck. It’s now a surprisingly luxurious family vehicle with a slew of creature comforts and modern conveniences, including wireless mobile phone charging, two rear-seat infotainment screens, a power liftgate, and ventilated seats. It also boasts a comprehensive array of high-tech safety features, including parking assist and automatic blind-spot monitoring. And, as a full-size SUV, it goes without saying that it’s all-weather capable and more than sufficient to carry cargo on road trips of any length.
Yukon’s five-year resale resiliency is noteworthy and better than any other vehicle in its class by a narrow margin. However, given its high upfront price, it’s not the best investment for buyers who prioritize cost above all else.
13. Toyota Tacoma
- Class: Mid-size pickup
- EPA MPG: 20 city, 23 highway
- MSRP: $26,050
- 5-Year Resale Value: 60.6%
Tacoma has also been around for quite a while. Like Yukon, this trusty pickup has really grown up. With a four-door cab and a surprisingly elegant interior, today’s Tacoma is more family wagon than work truck.
Nevertheless, the suspension remains rugged enough and the drivetrain strong enough to handle rough roads and heavy loads. A built-in tie-down system expands the bed’s potential, and a slew of optional features (such a rear locking differential and Crawl Control) make off-roading a realistic goal for intrepid Tacoma owners.
14. Chevrolet Silverado 2500HD
- Class: Heavy-duty pickup
- EPA MPG: 11 city, 16 highway
- MSRP: $35,695
- 5-Year Resale Value: 60.1%
Silverado 2500HD is a serious truck for serious jobs. Even if you don’t have a job or business that requires you to haul equipment and supplies onto dusty, muddy work sites, Silverado’s outrageous towing capacity (over 15,000 pounds) is more than enough to get your trailer, boat, or shanty wherever it needs to go. The unsurprising downside is poor fuel efficiency, which anecdotal reports peg a few notches below official ratings.
15. Toyota Tundra
- Class: Full-size pickup
- EPA MPG: 13 city, 18 highway
- MSRP: $33,575
- 5-Year Resale Value: 57.2%
Bigger and brawnier than Tacoma, Tundra is made for truck owners who need more cab space, towing capacity, on-road power, or a just higher profile. With the right set of options, the engine is powerful enough to tow a recreational vehicle, and the bed large enough to fit a subcompact car.
If you’re a sucker for creature comforts, the much more expensive Platinum trim has all the trappings of a full-size SUV. If you live in a cold climate or rural area, spring for the four-wheel drive (all-wheel drive version.
16. Honda Odyssey
- Class: Minivan
- EPA MPG: 19 city, 28 highway
- MSRP: $30,790
- 5-Year Resale Value: 39.4%
A tad more efficient than Toyota Sienna, Honda Odyssey is a worthy alternative to its largest competitor’s flagship minivan. And it’s arguably even more flexible and user-friendly than Sienna, thanks to low-step doors and a roomy back compartment that can be greatly expanded with a few tweaks to the interior seating.
On the other hand, it doesn’t hold its value quite as well – a key consideration for families looking to sell their Odysseys before they reach the scrap heap.
Maybe you’re trying to keep your student debt from spiraling even further by choosing an affordable, economical car for college students. Maybe you’re welcoming a new baby and upsizing your family’s transport accordingly. Or perhaps you’ve moved to a new city where it’s no longer possible or practical to live without a car.
Whatever your personal needs, you can probably find a car on this list that suits your lifestyle and budget. As you narrow down your choices, don’t forget to use a research tool such as Edmunds, Kelley Blue Book, or TrueCar to determine what others in your area have paid recently for your preferred models.