Consumers can buy these 3-year-old vehicles for about half off their new car price
With off-lease vehicles flooding the market, a new study by iSeeCars.com reveals which late-model used cars are the best deals for consumers – from 45 percent to 51 percent savings versus buying new.
These almost-new bargains range from $11,853 to $33,727, including eight options under $25,000.
“Whether you call them almost new, gently used or lightly used, the fact that auto leases have risen 91 percent in the last five years means a boon for shoppers who want a late-model car at a bargain price,” said Phong Ly, CEO of iSeeCars.com. “While some of the Best Bargains we identified are leased more than others, they all have the most depreciation after three years and they’re great buying opportunities when you look at the data.”
iSeeCars.com analyzed more than 5.8 million car sales to identify models with the greatest loss in value after three years, when most leased cars enter the used car market. The automotive research firm found the following vehicles had at least 1.3 times higher depreciation than the 34.5 percent average for all vehicles:
11 Best Bargains on Almost-New Cars
|Rank||Car||Avg. 3-Year-Old Used Price||% Depreciation||Depreciation Compared to Average|
|1||Cadillac CTS||$ 27,537||51.4%||1.49 x|
|2||Cadillac ATS||$ 21,173||50.4%||1.46 x|
|3||Mercedes-Benz E-Class||$ 33,727||48.4%||1.40 x|
|4||Mercedes-Benz C-Class||$ 23,212||48.3%||1.40 x|
|5||BMW 5 Series||$ 33,474||48.0%||1.39 x|
|6||Nissan Maxima||$ 18,867||47.9%||1.39 x|
|7||BMW 3 Series||$ 24,821||46.9%||1.36 x|
|8||Infiniti Q50||$ 24,956||46.9%||1.36 x|
|9||Volkswagen Jetta||$ 13,033||46.4%||1.34 x|
|10||Ford Fusion||$ 15,140||45.1%||1.31 x|
|11||Ford Focus||$ 11,853||45.0%||1.30 x|
|Average for All Vehicles||34.5%||1.00 x|
The CTS is one of just three cars over the $27,000 mark, joined by the Mercedes Benz E-Class and BMW 5 Series that are in the $33,000 range.
“BMW, Infinity and Mercedes-Benz all have lease penetration rates above 50 percent,” said Ly. “Luxury brands are known for depreciating at a higher rate because they’re often leased to keep monthly payments down, so this helps create a constant influx of 3-year-old vehicles in the used car market, driving prices lower.”
For more budget-conscious shoppers, the Ford Focus offers the lowest 3-year-old price at $11,853. The other three mainstream models also had low average prices, ranging from $13,033 for the Volkswagen Jetta up to $18,867 for the Nissan Maxima.
Along with the highest 3-year depreciation, most of the ranked cars have average or better reliability ratings from Consumer Reports. The Mercedes-Benz models, BMW 3 Series and Nissan Maxima all received above average ratings.
Only four of the Best Bargains have below average reliability ratings: the Cadillac CTS, Cadillac ATS, Volkswagen Jetta and Ford Focus. But because all of the vehicles on the list are only three years old, they’re most likely still covered under the manufacturers’ new vehicle warranties. Typically, those range between 3 to 4 years/36,000 to 50,000 miles for basic coverage and 4 to 6 years/50,000 to 70,000 miles for powertrain coverage.
“For the seven almost-new Best Bargains with average or better reliability, their higher depreciation rates can be tied to either slow sales or strong incentives that increased the number of vehicles leased,” said Ly.
America's 20 Most Popular Cars
Other than the Ford Fusion, none of America's most popular cars are among the 3-year-old cars with the most depreciation. However, 12 of the 20 did have higher 3-year depreciation than the average for all vehicles. These include two of the least expensive options, the Hyundai Elantra and Nissan Sentra with average prices of $12,931 and $12,322, respectively.
“Continuing demand for the country’s top 20 cars in both new and used models, combined with good reputations for being reliable may help keep depreciation rates lower," said Ly. "One-third of America's 20 most popular vehicles are also SUVs – the hottest segment in the market right now – so that high demand that may be another contributing factor to better resale values.”
America's Most Popular Cars: Ranking of 3-Year Depreciation
|Rank||Top-20 Cars||Avg. 3-Year-Old Used Price||% Depreciation||Depreciation Compared to Average|
|1||Ford Fusion||$ 15,140||45.1%||1.31 x|
|2||Nissan Altima||$ 14,545||43.1%||1.25 x|
|3||Chevrolet Malibu||$ 14,622||42.5%||1.23 x|
|4||Ford Escape||$ 17,492||42.0%||1.22 x|
|5||Chevrolet Equinox||$ 17,200||40.8%||1.18 x|
|6||Toyota Camry||$ 15,679||40.0%||1.16 x|
|7||Hyundai Elantra||$ 12,931||39.1%||1.13 x|
|8||Jeep Grand Cherokee||$ 27,483||38.3%||1.11 x|
|9||Honda Accord||$ 17,419||36.6%||1.06 x|
|10||Nissan Sentra||$ 12,322||36.5%||1.06 x|
|11||Ford Explorer||$ 26,167||35.9%||1.04 x|
|12||Nissan Rogue||$ 18,867||34.8%||1.01 x|
|Average for All Vehicles||34.5%||1.00 x|
|13||Toyota Corolla||$ 13,976||33.4%||0.97 x|
|14||Honda Civic||$ 14,624||31.5%||0.91 x|
|15||Honda CR-V||$ 19,368||31.2%||0.90 x|
|16||Ram Pickup 1500||$ 27,122||30.8%||0.89 x|
|17||Ford F-150||$ 30,216||29.6%||0.86 x|
|18||Toyota RAV4||$ 20,360||29.3%||0.85 x|
|19||GMC Sierra 1500||$ 31,731||28.8%||0.83 x|
|20||Chevrolet Silverado 1500||$ 29,671||28.6%||0.83 x|
When looking at SUVs only, iSeeCars.com found four that had at least 1.2 times more depreciation than the SUV average depreciation of 35.4 percent – representing a 42.4 percent to a 44.0 percent loss in value.
All have average or better reliability except for the Infiniti QX60, with the other three SUVs offering car shoppers strong choices at very affordable prices from $18,000 to $28,000.
Best Bargains on Almost New SUVs
|Rank||SUV||Avg. 3-Year-Old Used Price||% Depreciation||Depreciation Compared to SUV Average|
|1||Cadillac SRX||$ 27,157||44.0%||1.24 x|
|2||Buick Enclave||$ 27,549||43.7%||1.23 x|
|3||Kia Sorento||$ 18,535||42.9%||1.21 x|
|4||Infiniti QX60||$ 30,772||42.4%||1.20 x|
|Average for All SUVs||35.4%||1.00 x|
Almost-New Pickup Trucks
The average 3-year depreciation for pickup trucks was 28.5 percent, making it the only segment with all models logging depreciation rates below the overall average.
“Below-average depreciation isn't surprising when you consider the increased demand for trucks,” said Ly. “In a previous study, we found that original owners also keep their pickups longer than the average vehicle.”
Three of the most popular trucks from Ram, Ford and GMC had greater-than-average depreciation, though not as high as the vehicles on the 11 Best Bargains or SUV Bargains lists. The first-ranked Ram Pickup 1500’s depreciation was only 1.08 times the average for all trucks.
Best Bargains on Almost-New Trucks
|Rank||Truck||Avg. 3-Year-Old Used Price||% Depreciation||Depreciation Compared to Truck Average|
|1||Ram Pickup 1500||$ 27,122||30.8%||1.08 x|
|2||Ford F-150||$ 30,216||29.6%||1.04 x|
|3||GMC Sierra 1500||$ 31,731||28.8%||1.01 x|
|Average for All Trucks||28.5%||1.00 x|
“If you want to save money, buying a car that’s already lost most of its depreciation is a smart choice,” said Ly. “By choosing one of the 3-year-old cars on the Best Bargains List that have good reliability ratings, you're going to get solid transportation for the long haul.”
iSeeCars.com analyzed more than 4.7 million new cars from model year 2014 sold between January and May 2014, and more than 1.1 million used cars from the same model year sold between January and May 2017. Models with fewer than 4,000 new and 4,000 used sales were excluded from further analysis. Prices from 2014 were inflation-adjusted by 3.5 percent to 2017 dollars, based on data from the US Bureau of Labor Statistics. The difference in average price for the same model across the two time periods was calculated as a percentage of the average price in 2014. This depreciation was used to rank models, and the depreciation for each model was compared to the overall average depreciation of 34.5 percent.
iSeeCars.com is an automotive data and research company that’s saved car shoppers more than $115 million. It helps consumers find the best deals by providing key insights and guidance, using big data analytics powered by over 25 billion (and growing) data points and proprietary algorithms to objectively analyze, score and rank millions of cars and thousands of dealers. Based in the Boston area, iSeeCars.com was founded by a former TripAdvisor developer and SAP executive determined to improve the car shopping experience.