If you’re looking to buy a new car, one warning that you’ll hear over and over is about depreciation. This doesn’t matter too much if you’re planning to keep the car indefinitely but if there’s a chance you might sell it in the future then you’ll want one that holds its value so you can make back a big chunk of the sale price.
There’s been plenty of research into this and there are clear brands, styles and models that do the best.
Standard depreciation schedule for cars in Australia
If you look at the market as a whole, there’s a good blueprint for how much value your new car will lose:
- 10% to 15% drop in the first year (almost immediately, in most cases)
- 45% drop by the end of the third year
- 60% drop by the end of the fifth year
If you want a vehicle that holds onto its value, those are the benchmarks to beat.
Vehicle types that hold onto their value the best
The cars that hold their value best are the ones that are most popular on the roads. Utes will always be in demand with tradies so the second hand ute market remains competitive.
The best vehicle types (after three years of ownership) tends to be 4WDs, family SUVs and dual-cab utes.
At the other end of the scale, luxury European cars and electric vehicles tend to drop in value the most. However, as EV technology develops, their value is staying higher for longer.
Brands that hold onto their value the best
Brand trust and loyalty goes a long way in Australia, and there are certain manufacturers who tend to do better in the second hand market. Cars that have trusted names and low maintenance costs (eg no rare/specialist imports) tend to do best.
Toyota is one of the best car makers in this regard, with models like HiLux and Prado doing very well on the second hand market. When comparing utes, the HiLux might cost more than most, but if you factor in resale value it might work out better than some of the more budget options. Generally Toyotas only lose 25% of their cost in the first three years.
Other brands that do well are Subaru, Honda and Hyundai.
Some manufacturers are hit and miss. A Ford Ranger tends to do well on the second hand market, but other Ford models don’t hold up so well. The same is true for brands like VW.
We’ve seen a rapid influx of Chinese cars recently and the verdict is still out on those. We don’t have enough data to see how well they sell as used vehicles and buyer confidence is yet to be tested.
Five cars with best resale value (2026 data)
Based on data for sales of cars between two and four years old, there are some clear winners on the second hand market:
- Suzuki Jimny
- Toyota Yaris
- Toyota Landcruiser
- Kia Picanto
- Honda Jazz
As you get into older models, between five and seven years, the Yaris, Picanto and Jazz are again up at the top of the list. Other cars like the Mazda 2 and Honda City join them.
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