Index
What is depreciation and why is it the biggest expense of owning a car
The depreciation curve: how much a car loses each year
Factors that accelerate or slow down depreciation
Depreciation by engine type in 2026
Brands and models that retain value best
Brands and models that retain value worst
How to calculate how much your car has lost
When is the best time to sell based on depreciation
Frequently asked questions
Depreciation is the biggest expense of owning a car. Bigger than fuel, bigger than insurance, bigger than maintenance. Yet, it is the most invisible expense: it is not paid monthly with an invoice, but accumulates silently until the day you sell and discover that your car is worth half of what you paid.
A new car costing £25,000 can lose between £5,000 and £7,000 in value in the first year alone. By year three, the cumulative loss can exceed £12,000. By year five, more than £15,000. These figures are not exceptions: they are the market average.
Understanding how depreciation works gives you a huge advantage when deciding when to sell your car, because every month you wait without a concrete plan is money lost.
What is depreciation and why is it the biggest expense of owning a car
Depreciation is the difference between what you paid for your car and what the market is willing to pay you today. It is a loss of value that occurs due to use, the passage of time, wear and tear, and changes in supply and demand.
To put it into perspective, an average £25,000 car has these approximate annual costs. Fuel: £1,500-£2,000. Insurance: £400-£800. Maintenance: £500-£800. MOT and taxes: £100-£300. Depreciation: £2,000-£4,000. Depreciation is, by far, the biggest item.
The difference with other costs is that depreciation is not felt day-to-day. You don't take out your wallet to pay for it. It simply happens, and you only notice it when you go to sell. That's why most owners ignore it. And that's why understanding it puts you at an advantage.
The depreciation curve: how much a car loses each year
Depreciation is not linear. A car loses more value at the beginning and less as it ages. The general curve for an average car in Spain in 2026 follows this pattern.
Upon registration (day 1). The car loses between 18% and 22% of its value just by putting registration plates on it. A new £25,000 car is worth £19,500-£20,500 as a "nearly new with 0 km" instantly. This loss is immediate and inevitable.
Year 1. Cumulative loss of 20-30% on the purchase price. A £25,000 car is worth £17,500-£20,000 at the end of the first year (depending on make and model).
Year 2. Cumulative loss of 30-40%. Value: £15,000-£17,500.
Year 3. Cumulative loss of 40-50%. Value: £12,500-£15,000. At three years, half the price has already evaporated for many models.
Years 4-5. The curve flattens out. The annual loss drops to 8-12%. The car is worth between £10,000 and £13,000.
Years 6-10. Depreciation stabilises at 5-8% annually. The car is worth between £5,000 and £10,000, depending on condition and mileage.
More than 10 years. Depreciation depends more on mechanical condition and history than age itself. A well-maintained 12-year-old car can be worth more than a neglected 8-year-old one.
Factors that accelerate or slow down depreciation
Not all cars lose value at the same rate. Some factors accelerate depreciation and others slow it down.
What accelerates depreciation
Diesel engine. LEZ restrictions have accelerated the depreciation of diesel cars, especially those without a C label. A diesel with a B label can lose between 8% and 12% annually, compared to 5-7% for an equivalent petrol car.
Diesels are depreciating faster than ever. Check how to sell your diesel car in 2026.
High production and leasing fleets. When a model is sold in large volumes to leasing companies, thousands of units return to the used market at the same time (when leasing contracts end). This flood of supply depresses prices. The Dacia Sandero and Renault Captur are clear examples: according to recent OCU data, they can lose up to 40% of their value in the first two years, partly due to the high volume of units on the market.
First-generation electric cars. Technology is advancing so fast that electric cars from 3-4 years ago (with less range, slower charging) compete with much more capable new models at the same or lower price. The depreciation of electric cars can exceed 50% in three years.
Poor reliability reputation. Brands perceived as unreliable (due to breakdowns, high maintenance costs or poor after-sales service image) depreciate faster. The second-hand buyer wants peace of mind, and brands with a bad reputation do not offer it.
Without environmental label. Cars without a label (petrol before 2001, diesel before 2006) lose value at an accelerated rate due to the LEZ restrictions expanding every year.
What slows down depreciation
ECO or ZERO label. Cars with these labels depreciate between 10% and 15% less than pure combustion vehicles, because they have no circulation restrictions and offer tax advantages (discounts on IVTM, free parking in many cities).
Brands with a reputation for reliability. Toyota and Lexus are the undisputed champions of value retention. Their reputation for reliability means second-hand buyers are willing to pay more. A 3-year-old Toyota Corolla Hybrid can retain 55-60% of its original value.
Low supply in the second-hand market. Models that sold poorly as new have little second-hand supply, which supports prices. Limited production cars or niche brand cars depreciate less.
Full service history. A car with all services done at an official dealership retains between 5% and 10% more value than the same model without history.
In-demand equipment. Automatic transmission, panoramic roof, 360 camera, and driver assistance packages slow down depreciation because the second-hand buyer actively looks for them.
Depreciation by engine type in 2026
The engine type is the factor that most influences depreciation in today's market, even more than the brand itself.
Engine type | Average 3-year depreciation | Trend |
|---|---|---|
Non-plug-in hybrid (HEV) | 35-45% | The lowest. High demand, ECO label |
Petrol with C label | 40-50% | Stable. Market benchmark |
Plug-in hybrid (PHEV) | 42-52% | Moderate. Improving due to ZERO label |
Diesel with C label | 45-55% | Increasing. LEZ pressing demand |
Pure electric (BEV) | 50-60% | The highest. Technology advances quickly |
Diesel with B label | 55-65% | Accelerated. Growing restrictions |
The most relevant fact: non-plug-in hybrids depreciate less than any other engine type. This confirms a trend that has consolidated over the last two years and is not going to reverse in the short term.
Brands and models that retain value best
Brands that retain best
Toyota. It is the brand that most consistently retains value in Spain. The Toyota Yaris Hybrid, Corolla Hybrid, and RAV4 Hybrid are among the cars that depreciate the least on the market. Their reputation for reliability, low maintenance costs, and ECO label are the perfect combination for resale.
Toyota hybrids retain value best. Find out why hybrids sell quickly.
Lexus. As Toyota's premium brand, it inherits reliability and adds the luxury factor. The Lexus UX, NX, and RX Hybrid retain value exceptionally well.
Porsche. In the premium segment, Porsche retains more than BMW, Mercedes or Audi. The Cayenne, Macan and 911 have second-hand demand that supports prices.
Dacia (with caveats). Dacias depreciate a lot in percentage terms (up to 40% in two years according to the OCU), but because they start at a low price, the loss in absolute pounds is smaller. A Dacia Sandero that cost £12,000 and depreciates 40% loses £4,800. A BMW 3 Series that cost £45,000 and depreciates 35% loses £15,750. In absolute pounds, the Dacia loses much less.
Specific models that retain best (2026)
Toyota Yaris Hybrid: retains ~60% at 3 years
Toyota Corolla Hybrid: retains ~55-60% at 3 years
Toyota RAV4 Hybrid: retains ~55% at 3 years
Porsche Macan: retains ~60-65% at 3 years
Lexus NX: retains ~55-60% at 3 years
Brands and models that retain value worst
Brands with accelerated depreciation
Dacia and Renault (mainstream models). The Dacia Sandero Stepway and the Renault Captur head the lists of highest depreciation according to the OCU, with losses close to 40% in just two years. High production, leasing fleets, and the perception of a low-cost brand push prices down.
Jaguar and Land Rover. High maintenance costs and a perception of low reliability make these cars depreciate faster than their German competitors. A Jaguar XE or a Land Rover Discovery Sport can lose 60-65% in 5 years.
First-generation electric cars. Models like the Nissan LEAF 40kWh, the Renault ZOE or the BMW i3 depreciate very fast because they compete with new electric cars that offer double the range at the same price.
Mainstream diesels without a C label. Diesel Citroën, Opel and Fiat cars prior to 2015 lose value the fastest because they combine a mainstream brand + declining engine option + LEZ restrictions.
First-generation electric cars depreciate very quickly. Check our guide on selling a second-hand electric car.
How to calculate how much your car has lost
You can make a quick estimate with this simplified calculation.
Step 1: Original price of the car. What you paid (or the list price if you bought it second-hand).
Step 2: Apply the depreciation coefficient per year.
Age | Estimated residual value (% of original price) |
|---|---|
1 year | 70-80% |
2 years | 60-70% |
3 years | 50-60% |
4 years | 45-55% |
5 years | 38-48% |
7 years | 28-38% |
10 years | 15-25% |
Step 3: Adjust for specific factors. Add 5% if it is a hybrid with an ECO label. Subtract 5% if it is a diesel with a B label. Add 3-5% if it has a full service history. Subtract 3-5% if its mileage is above average. Add 3-5% if it is a brand with good retention (Toyota, Lexus, Porsche). Subtract 3-5% if it is a brand with poor retention (Jaguar, Maserati).
Example. You bought a Hyundai Tucson 1.6 GDi for £28,000 four years ago. Base residual value: 45-55% = £12,600-£15,400. It is a petrol car with a C label (no adjustment). It has a full history (+3%): £13,440-£16,170. Normal mileage (no adjustment). Estimated range: £13,400-£16,200.
But the best way to know the real value is not a theoretical calculation: it is to request real offers. Dealcar's valuator gives you a evaluation in 30 seconds, and then more than 1,000 dealerships can send you offers that reflect what the market pays today. Not what a table says, but what a buyer with money is willing to give you.
For a complete reference of the factors that determine value, check how to know what your car is worth.
When is the best time to sell based on depreciation
Depreciation gives you a clear hint on when to sell to minimise loss.
The sweet spot: 3-4 years. At 3-4 years, the car has already absorbed most of the initial depreciation (the hardest hit of the first year is over). From here on, the curve flattens out. If you sell at 3-4 years, you recover the maximum relative value before continued depreciation keeps eating away at it.
Sell before a model change. When a manufacturer launches a new generation of your model, the previous generation loses value abruptly. If you know your model is going to be updated next year, selling before the launch protects you from that drop.
Sell before a regulatory change. LEZ restrictions tighten progressively. If your car has a B label, each announcement of new restrictions pushes its price down. Selling before the next phase of restrictions comes into force yields a better price.
Don't wait "for the market to go up". Cars are not real estate. Unlike a house, a car is never going to be worth more next year than today (excepting classic cars). Every month you wait without a concrete plan is depreciation you lose.
Waiting without a plan is one of the mistakes that make you sell your car for less money.
The rule of thumb. If you have already decided you are going to sell, the best time is now. Not tomorrow, not next month, not when "the market improves". Today's price is, with a very high probability, the highest you are going to get for your car.
Dealcar: value your car for free and find out what it is worth today
Theoretical depreciation gives you a benchmark. Real offers give you the exact figure. With Dealcar, you value your car for free in less than 30 seconds and receive offers from more than 1,000 dealerships competing with each other.
Don't lose any more value by waiting. With every passing month, your car is worth less.
100% free for you. No commissions or hidden costs.
Get paid before handing over the keys. Bank transfer before delivering the car.
We collect the car from your home. No travel needed.
Hassle-free. The dealer manages the transfer, DGT, and all paperwork.
On average, £1,400 more than selling on Wallapop.
More than 12,000 cars sold and an average rating of 4.9 out of 5.
Frequently asked questions
How much does a car lose when leaving the dealership?
Between 18% and 22% of its value, just by being registered. It is the biggest and fastest loss in the entire life of the car. A £25,000 car becomes worth £19,500-£20,500 the day it is registered.
Which cars depreciate the least?
Non-plug-in hybrids from brands with a good reputation for reliability (Toyota, Lexus). The combination of an ECO label, low consumption, and proven reliability is what retains value best in the 2026 market.
Do electric cars depreciate a lot?
Yes. Electric cars have the fastest depreciation on the market: they can lose 50-60% in three years. The reason is that technology is moving fast and new models offer more range and better prices, putting pressure on used ones.
How can I reduce my car's depreciation?
You cannot avoid it, but you can minimise it: keep the service history up to date, look after the interior, do not accumulate unnecessary mileage, and sell at the right time (before model updates or regulatory changes). The most important decision is when to sell, not how to preserve.
Is depreciation the same in all autonomous communities?
Almost. Regional differences are smaller than differences by brand, model or engine type. The only significant regional factor is the environmental label in cities with LEZs: a car without a label loses more value in Madrid or Barcelona than in a small town without restrictions.
Index
What is depreciation and why is it the biggest expense of owning a car
The depreciation curve: how much a car loses each year
Factors that accelerate or slow down depreciation
Depreciation by engine type in 2026
Brands and models that retain value best
Brands and models that retain value worst
How to calculate how much your car has lost
When is the best time to sell based on depreciation
Frequently asked questions
Depreciation is the biggest expense of owning a car. Bigger than fuel, bigger than insurance, bigger than maintenance. Yet, it is the most invisible expense: it is not paid monthly with an invoice, but accumulates silently until the day you sell and discover that your car is worth half of what you paid.
A new car costing £25,000 can lose between £5,000 and £7,000 in value in the first year alone. By year three, the cumulative loss can exceed £12,000. By year five, more than £15,000. These figures are not exceptions: they are the market average.
Understanding how depreciation works gives you a huge advantage when deciding when to sell your car, because every month you wait without a concrete plan is money lost.
What is depreciation and why is it the biggest expense of owning a car
Depreciation is the difference between what you paid for your car and what the market is willing to pay you today. It is a loss of value that occurs due to use, the passage of time, wear and tear, and changes in supply and demand.
To put it into perspective, an average £25,000 car has these approximate annual costs. Fuel: £1,500-£2,000. Insurance: £400-£800. Maintenance: £500-£800. MOT and taxes: £100-£300. Depreciation: £2,000-£4,000. Depreciation is, by far, the biggest item.
The difference with other costs is that depreciation is not felt day-to-day. You don't take out your wallet to pay for it. It simply happens, and you only notice it when you go to sell. That's why most owners ignore it. And that's why understanding it puts you at an advantage.
The depreciation curve: how much a car loses each year
Depreciation is not linear. A car loses more value at the beginning and less as it ages. The general curve for an average car in Spain in 2026 follows this pattern.
Upon registration (day 1). The car loses between 18% and 22% of its value just by putting registration plates on it. A new £25,000 car is worth £19,500-£20,500 as a "nearly new with 0 km" instantly. This loss is immediate and inevitable.
Year 1. Cumulative loss of 20-30% on the purchase price. A £25,000 car is worth £17,500-£20,000 at the end of the first year (depending on make and model).
Year 2. Cumulative loss of 30-40%. Value: £15,000-£17,500.
Year 3. Cumulative loss of 40-50%. Value: £12,500-£15,000. At three years, half the price has already evaporated for many models.
Years 4-5. The curve flattens out. The annual loss drops to 8-12%. The car is worth between £10,000 and £13,000.
Years 6-10. Depreciation stabilises at 5-8% annually. The car is worth between £5,000 and £10,000, depending on condition and mileage.
More than 10 years. Depreciation depends more on mechanical condition and history than age itself. A well-maintained 12-year-old car can be worth more than a neglected 8-year-old one.
Factors that accelerate or slow down depreciation
Not all cars lose value at the same rate. Some factors accelerate depreciation and others slow it down.
What accelerates depreciation
Diesel engine. LEZ restrictions have accelerated the depreciation of diesel cars, especially those without a C label. A diesel with a B label can lose between 8% and 12% annually, compared to 5-7% for an equivalent petrol car.
Diesels are depreciating faster than ever. Check how to sell your diesel car in 2026.
High production and leasing fleets. When a model is sold in large volumes to leasing companies, thousands of units return to the used market at the same time (when leasing contracts end). This flood of supply depresses prices. The Dacia Sandero and Renault Captur are clear examples: according to recent OCU data, they can lose up to 40% of their value in the first two years, partly due to the high volume of units on the market.
First-generation electric cars. Technology is advancing so fast that electric cars from 3-4 years ago (with less range, slower charging) compete with much more capable new models at the same or lower price. The depreciation of electric cars can exceed 50% in three years.
Poor reliability reputation. Brands perceived as unreliable (due to breakdowns, high maintenance costs or poor after-sales service image) depreciate faster. The second-hand buyer wants peace of mind, and brands with a bad reputation do not offer it.
Without environmental label. Cars without a label (petrol before 2001, diesel before 2006) lose value at an accelerated rate due to the LEZ restrictions expanding every year.
What slows down depreciation
ECO or ZERO label. Cars with these labels depreciate between 10% and 15% less than pure combustion vehicles, because they have no circulation restrictions and offer tax advantages (discounts on IVTM, free parking in many cities).
Brands with a reputation for reliability. Toyota and Lexus are the undisputed champions of value retention. Their reputation for reliability means second-hand buyers are willing to pay more. A 3-year-old Toyota Corolla Hybrid can retain 55-60% of its original value.
Low supply in the second-hand market. Models that sold poorly as new have little second-hand supply, which supports prices. Limited production cars or niche brand cars depreciate less.
Full service history. A car with all services done at an official dealership retains between 5% and 10% more value than the same model without history.
In-demand equipment. Automatic transmission, panoramic roof, 360 camera, and driver assistance packages slow down depreciation because the second-hand buyer actively looks for them.
Depreciation by engine type in 2026
The engine type is the factor that most influences depreciation in today's market, even more than the brand itself.
Engine type | Average 3-year depreciation | Trend |
|---|---|---|
Non-plug-in hybrid (HEV) | 35-45% | The lowest. High demand, ECO label |
Petrol with C label | 40-50% | Stable. Market benchmark |
Plug-in hybrid (PHEV) | 42-52% | Moderate. Improving due to ZERO label |
Diesel with C label | 45-55% | Increasing. LEZ pressing demand |
Pure electric (BEV) | 50-60% | The highest. Technology advances quickly |
Diesel with B label | 55-65% | Accelerated. Growing restrictions |
The most relevant fact: non-plug-in hybrids depreciate less than any other engine type. This confirms a trend that has consolidated over the last two years and is not going to reverse in the short term.
Brands and models that retain value best
Brands that retain best
Toyota. It is the brand that most consistently retains value in Spain. The Toyota Yaris Hybrid, Corolla Hybrid, and RAV4 Hybrid are among the cars that depreciate the least on the market. Their reputation for reliability, low maintenance costs, and ECO label are the perfect combination for resale.
Toyota hybrids retain value best. Find out why hybrids sell quickly.
Lexus. As Toyota's premium brand, it inherits reliability and adds the luxury factor. The Lexus UX, NX, and RX Hybrid retain value exceptionally well.
Porsche. In the premium segment, Porsche retains more than BMW, Mercedes or Audi. The Cayenne, Macan and 911 have second-hand demand that supports prices.
Dacia (with caveats). Dacias depreciate a lot in percentage terms (up to 40% in two years according to the OCU), but because they start at a low price, the loss in absolute pounds is smaller. A Dacia Sandero that cost £12,000 and depreciates 40% loses £4,800. A BMW 3 Series that cost £45,000 and depreciates 35% loses £15,750. In absolute pounds, the Dacia loses much less.
Specific models that retain best (2026)
Toyota Yaris Hybrid: retains ~60% at 3 years
Toyota Corolla Hybrid: retains ~55-60% at 3 years
Toyota RAV4 Hybrid: retains ~55% at 3 years
Porsche Macan: retains ~60-65% at 3 years
Lexus NX: retains ~55-60% at 3 years
Brands and models that retain value worst
Brands with accelerated depreciation
Dacia and Renault (mainstream models). The Dacia Sandero Stepway and the Renault Captur head the lists of highest depreciation according to the OCU, with losses close to 40% in just two years. High production, leasing fleets, and the perception of a low-cost brand push prices down.
Jaguar and Land Rover. High maintenance costs and a perception of low reliability make these cars depreciate faster than their German competitors. A Jaguar XE or a Land Rover Discovery Sport can lose 60-65% in 5 years.
First-generation electric cars. Models like the Nissan LEAF 40kWh, the Renault ZOE or the BMW i3 depreciate very fast because they compete with new electric cars that offer double the range at the same price.
Mainstream diesels without a C label. Diesel Citroën, Opel and Fiat cars prior to 2015 lose value the fastest because they combine a mainstream brand + declining engine option + LEZ restrictions.
First-generation electric cars depreciate very quickly. Check our guide on selling a second-hand electric car.
How to calculate how much your car has lost
You can make a quick estimate with this simplified calculation.
Step 1: Original price of the car. What you paid (or the list price if you bought it second-hand).
Step 2: Apply the depreciation coefficient per year.
Age | Estimated residual value (% of original price) |
|---|---|
1 year | 70-80% |
2 years | 60-70% |
3 years | 50-60% |
4 years | 45-55% |
5 years | 38-48% |
7 years | 28-38% |
10 years | 15-25% |
Step 3: Adjust for specific factors. Add 5% if it is a hybrid with an ECO label. Subtract 5% if it is a diesel with a B label. Add 3-5% if it has a full service history. Subtract 3-5% if its mileage is above average. Add 3-5% if it is a brand with good retention (Toyota, Lexus, Porsche). Subtract 3-5% if it is a brand with poor retention (Jaguar, Maserati).
Example. You bought a Hyundai Tucson 1.6 GDi for £28,000 four years ago. Base residual value: 45-55% = £12,600-£15,400. It is a petrol car with a C label (no adjustment). It has a full history (+3%): £13,440-£16,170. Normal mileage (no adjustment). Estimated range: £13,400-£16,200.
But the best way to know the real value is not a theoretical calculation: it is to request real offers. Dealcar's valuator gives you a evaluation in 30 seconds, and then more than 1,000 dealerships can send you offers that reflect what the market pays today. Not what a table says, but what a buyer with money is willing to give you.
For a complete reference of the factors that determine value, check how to know what your car is worth.
When is the best time to sell based on depreciation
Depreciation gives you a clear hint on when to sell to minimise loss.
The sweet spot: 3-4 years. At 3-4 years, the car has already absorbed most of the initial depreciation (the hardest hit of the first year is over). From here on, the curve flattens out. If you sell at 3-4 years, you recover the maximum relative value before continued depreciation keeps eating away at it.
Sell before a model change. When a manufacturer launches a new generation of your model, the previous generation loses value abruptly. If you know your model is going to be updated next year, selling before the launch protects you from that drop.
Sell before a regulatory change. LEZ restrictions tighten progressively. If your car has a B label, each announcement of new restrictions pushes its price down. Selling before the next phase of restrictions comes into force yields a better price.
Don't wait "for the market to go up". Cars are not real estate. Unlike a house, a car is never going to be worth more next year than today (excepting classic cars). Every month you wait without a concrete plan is depreciation you lose.
Waiting without a plan is one of the mistakes that make you sell your car for less money.
The rule of thumb. If you have already decided you are going to sell, the best time is now. Not tomorrow, not next month, not when "the market improves". Today's price is, with a very high probability, the highest you are going to get for your car.
Dealcar: value your car for free and find out what it is worth today
Theoretical depreciation gives you a benchmark. Real offers give you the exact figure. With Dealcar, you value your car for free in less than 30 seconds and receive offers from more than 1,000 dealerships competing with each other.
Don't lose any more value by waiting. With every passing month, your car is worth less.
100% free for you. No commissions or hidden costs.
Get paid before handing over the keys. Bank transfer before delivering the car.
We collect the car from your home. No travel needed.
Hassle-free. The dealer manages the transfer, DGT, and all paperwork.
On average, £1,400 more than selling on Wallapop.
More than 12,000 cars sold and an average rating of 4.9 out of 5.
Frequently asked questions
How much does a car lose when leaving the dealership?
Between 18% and 22% of its value, just by being registered. It is the biggest and fastest loss in the entire life of the car. A £25,000 car becomes worth £19,500-£20,500 the day it is registered.
Which cars depreciate the least?
Non-plug-in hybrids from brands with a good reputation for reliability (Toyota, Lexus). The combination of an ECO label, low consumption, and proven reliability is what retains value best in the 2026 market.
Do electric cars depreciate a lot?
Yes. Electric cars have the fastest depreciation on the market: they can lose 50-60% in three years. The reason is that technology is moving fast and new models offer more range and better prices, putting pressure on used ones.
How can I reduce my car's depreciation?
You cannot avoid it, but you can minimise it: keep the service history up to date, look after the interior, do not accumulate unnecessary mileage, and sell at the right time (before model updates or regulatory changes). The most important decision is when to sell, not how to preserve.
Is depreciation the same in all autonomous communities?
Almost. Regional differences are smaller than differences by brand, model or engine type. The only significant regional factor is the environmental label in cities with LEZs: a car without a label loses more value in Madrid or Barcelona than in a small town without restrictions.
