While purchasing a car, what do you look for? Usually people think about brand, performance, model, color and many more similar things. But does any one ever think of buying car considering the resale value it will get after using it for few years. Well the main reason for this is while purchasing a car no one will be bothered how to sell it after some years, but you have to always think of the resale value of cars. Always keep in mind that car is a derogating asset and after some years it will lose its aesthetic value.

A new car starts losing its value once it is driven out of the showroom.  The car loses maximum value in the first five years of ownership and then the value of the car depreciates gradually. Finally, when the car owner decides to sell a car after a span of five or six years, the depreciation is much higher. So, while buying a new car it is important to consider its resale value.

Kelley Blue Book (KBB) has released its annual resale value data for 2010, and according to them Toyota, Honda and BMW remain the top brands in five-year residual value. So you can clearly see that Japanese cars consistently lead in resale values.

KBB estimates Toyota’s models will keep 38.8% of their value while Honda’s models will keep 38 % of their value after five years. KBB’s top ten models for five-year residual value include the following Japanese cars. The Prius has been one of the topmost resale value cars for several years.

# Toyota Tacoma
# Toyota Prius
# Honda CR-V
# Toyota RAV4

Even in countries like India, when automakers from India, Korea, Europe, and America are having a major market share, Japanese cars like Honda Siel, Honda City, Toyota Innova fetch the maximum price on resale. Comparing other cars in Honda cars segment it loses about 20-30% value in 3 years whereas Toyota Innova can fetch around 70-80% of its road price even after 3 years.

What factors influence resale price?
Now you may question – how to calculate resale value of a car? Well it is not illogical. There are many factors which influence the resale price other than the general ones like registration date of car, current condition of car, no. of miles it has covered etc.

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How the purchaser distinguishes a particular product makes a whole lot of difference. For example the Japanese cars are known for their technology which makes their cars more efficient while the American cars are supposed to be fuel guzzlers.

Spare parts availability:
While purchasing car it is important to find out whether you can easily find its spare parts if you need them. Now as the survey suggests, it is quiet easy to find spare parts for Japanese cars while it is difficult to find spare parts for American and European cars.

Maintenance:
Japanese cars have a high level of reliability, which makes their maintenance costs low.

After sales service:
Many car companies do provide better service but they come with many restrictions.

Japanese cars consistently rank high in all these factors included in calculation of the resale price.

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