How much is that car worth? 

Everything you need to know about car pricing

While dealer price guides do exist, they are far from secret. Nor do they list prices for individual vehicles.

Instead, they provide a starting point from which an experienced person can calculate an approximate value based on things like condition, kilometres travelled and ‘market forces’ – something the average consumer simply won’t have the knowledge to do.

But there are other useful sources of information that the average consumer can use. This fact sheet looks at the common sources of price information, their limitations and how to interpret what you find.

But be warned, if you’re looking for a simple DIY formula for determining the value of a specific vehicle, you won’t find it here – or anywhere else – because it simply doesn’t exist.

Sources of price information

Apart from dealer guides, other sources include a variety of web sites, motoring clubs, registered valuers and various magazines and newspapers.

If you need a value that is accurate or that will stand up to scrutiny in a court of law (damages claims, divorce settlements etc.), you have no alternative but to employ the services of a qualified vehicle valuer. The valuer will need to see the vehicle and will charge for the service. Check the Yellow Pages under Valuers – General for one in your area.

Market value for insurance purposes can only be obtained from the insurer in question.

RACQ online price guide

The RACQ online price guide provides a broad price range, but it can’t account for things like distance travelled, accessories fitted, the type of transaction i.e. dealer sale, private sale, trade-in etc. The figures provided are a rough guide only.

Newspapers and magazines

Local newspapers:

• Are a reasonable source of vehicle price information.
• List many cars for sale in one place,
• In the region in which you are shopping and,
• Indicate a typical selling price range.

Some magazines advertise cars for sale:

• Many are aimed at enthusiasts and can provide a price source for unusual or collector cars.
• They will only provide the asking price – the actual selling price may be quite different.
• They may be useful where no other information is available.

Web sites and online services

Various web sites offer vehicle price information, either free online or for a fee.

The prices they offer will have the same limitations as those provided by RACQ.

Vehicle valuers

None of the sources mentioned above will stand legal scrutiny.

If you need to determine a value for legal purposes (damage claims, settlements, etc.), you should consult a licensed valuer.

Check the Yellow Pages for qualified Valuers in your area.

Fees will apply.

Factors that influence vehicle values

Condition

This is one of the most important issues affecting a vehicle’s value.

The effect of the vehicle’s condition on its value is difficult to measure.

Factors such as paint condition, dents, scratches and previous accident history affect value.

An independent vehicle inspection may assist you with putting condition into its proper perspective, but you’ll always need to use your own judgement about how it affects the car’s value.

Market forces

The popularity (or lack thereof) of a make, model or type of car in an area can have a considerable effect on its value.

Supply and demand is another issue. If demand exceeds supply the price will go up, if supply exceeds demand the price can be lower.

Dealer v private sales

Dealer asking prices are generally higher than for a private sale as dealers must make a profit to stay in business.

While private sale prices will generally be lower, some sellers can have a distorted view of a car’s value, which could inflate the asking price.

Trade-in prices

When buying a new or used car, it’s easy to focus on getting the best trade-in price possible for your old car. However, trade-in values can be manipulated.

Rather than focusing on the trade-in figure, it’s more important to look at the change-over cost (how much will it cost to get out of the old car and into the new one)

Distance travelled

The distance a vehicle has travelled has a great bearing on its value.

On average a privately used vehicle travels around 15,000km each year.

A fleet or business vehicle will travel around 15,000 km to 25,000 km each year.

There will be exceptions to this, with some travelling more or less.

Private and grey imports

Privately imported and used imports (also known as 'grey imports') can be less valuable than models that were supplied new to the Australian market.

The increased difficulty and costs of sourcing replacement parts play a part in this.

However, certain performance and collectable cars can attract high prices.

It can be difficult to put an accurate value on these cars.

Optional equipment and modifications

Some options and accessories can add to the value of a used vehicle while others won’t.

Optional equipment such as air conditioning, automatic transmission and power steering have long-term value.

Things like paint protection and window tinting will add little if any value.

The value of options reduces over time to the point where they will have little or no effect on the car’s value.

Modified vehicles are generally only attractive to certain buyers, therefore the effect of a modification on the vehicle’s value can vary considerably.

To some, significantly modified vehicles are not attractive.

The value of a modified vehicle is often related to the buyer’s perception rather than the vehicle’s actual value or the cost of the modification.

Key points

There is no simple DIY formula for determining the value of a specific vehicle. Every vehicle will have its own individual price.

Advertised prices will usually be higher than the actual selling price.

Private sale prices will almost always be lower than those asked by motor dealers.

Trade in prices are often dependent on the deal negotiated for the replacement car.

The effect distance travelled has on the price will vary from car to car.

Higher kilometres than average usually has a bigger impact on price than lower than average kilometres.

Overall condition has a huge impact on value.

Market forces and the popularity of a model in an area can make a considerable difference to its price.

How to use the information

Buying

Determine the range of prices in your area for the model in question (from several sources if possible).

Consider the type of transaction (a private sale price will usually be lower than for a dealer sale)

Form an opinion of the car’s overall condition and where it fits in the price range.

Consider distance travelled (i.e. is it significantly higher or lower than average?), what optional equipment is fitted (how valuable it is to you?), if modified, what is the value of the modification to you?

Selling

Determine the range of prices in your area for the model in question (from several sources if possible).

Consider the vehicle’s overall condition, distance travelled, modifications etc. and how this will impact the price.

The price asked by a dealer would generally be higher than you could ask in a private sale. This amount will vary, and you’ll need to make a judgement about what you’ll accept for the vehicle. If the price you select is too high, you may not get any calls.

Trade-ins

Consider the change-over figure. Don’t simply focus on the trade in price.