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Car Depreciation Calculator

Calculate how much your car loses in value each year.

A new car loses roughly 15-25% of its value in the first year and 10-15% per year after. Over 5 years, the average vehicle retains only 40-50% of its original purchase price. Understanding depreciation is critical for new vs used car decisions.

Enter your numbers

Purchase Price ($)

Years Owned

Annual Depreciation Rate (%)15%

Year 1 is typically 15-25%; subsequent years 10-15%.

Results update as you change the inputs. Calculations run in your browser.

Current Value

$15530

total Depreciation: $19470 lost
annual Cost: $3894/year
retained Percent: 44.4% retained

See the formula

Formula and method

Current Value = Purchase Price × (1 - Annual Rate)^Years

Constant percentage depreciation model. In reality, depreciation is steepest in year 1 and levels off. This model is a useful approximation for multi-year holding periods.

Worked examples

New SUV purchase

Purchase Price ($):: 45000
Years Owned:: 5
Annual Depreciation Rate (%):: 15

Current Value: $19967

Luxury sedan

Purchase Price ($):: 65000
Years Owned:: 3
Annual Depreciation Rate (%):: 22

Current Value: $30846

Assumptions and limits

Constant annual depreciation rate
Average condition and mileage

This tool provides an educational estimate. Rules, rates and personal circumstances can change the answer. Review the assumptions before relying on a result. Report a correction.

Common mistakes to avoid

Using MSRP instead of actual purchase price — dealer discounts and incentives affect real depreciation.
Applying the same rate to all vehicles — luxury cars often depreciate faster, trucks slower.
Forgetting that odometer and condition dramatically affect resale value beyond the formula.

Frequently asked questions

Which vehicles hold their value best?

In Canada, trucks (Toyota Tacoma, Ford F-150) and SUVs typically depreciate slowest at 10-12% annually. Luxury sedans and electric vehicles (except Tesla) often depreciate at 20-30% per year.

Is buying used always better?

Buying a 2-3 year old used car lets someone else absorb the steepest depreciation curve (year 1 loss of 20-25%). The first owner effectively pre-discounts the car for you.