When New Cars Lose Value Fast, Used Buyers Win!
Quick depreciation is a terrible thing. And a beautiful thing.
For buyers of new luxury cars, a sinking value can lead to abandoning a car after just a couple years of ownership. For buyers of used luxury cars, it can lead to some killer deals on cars that would have been unattainable new.
Think about it: If you had the choice between a brand-new, top-of-the-line Toyota Camry or a 3-year-old Jaguar XF, wouldn’t the Jag bring you an exponentially greater amount of happiness? Of course, it might also bring heftier insurance and repair bills, but that’s beside the point. We’re talking image here—and a well-priced used luxury car can provide ample amounts of that!
Some luxury models are notorious for dropping in value in the first couple years of ownership. The new Jaguars (XF, XJ) are better than they used to be (X-Type, S-Type), but still offer great values on the used market.
I’ll put Jag’s brutish big brother, Land Rover, in the same category. Shop for any used Range Rover, and you’ll find prices well below that of comparable new ones. The reason goes back to the British brands’ reputation for reliability. Both Jaguar and Land Rover have spotty reliability records, not to mention a long history of issues with electrical systems. Modern cars suffer from these ailments a lot less than older cars, but resale values have yet to catch up with quality.
The Cadillac Escalade tends to depreciate more quickly than other big luxury utes. To be fair, though, all SUVs in the Escalade’s class lose value, because they use so much fuel and don’t have a large market of buyers clamoring for pre-owned versions. Most civilized folks today opt for smaller, more fuel-efficient crossovers. Escalades continue to be built and sold, though in limited numbers, which means more used ones come on the market every day. If you truly need the capabilities of such a rig, check the CarGurus used listings before you buy and look for a great deal.
Which used luxury car would you buy?