Car depreciation table

How much does a car depreciate per year?

On Motorway and RAC figures, a new car loses 15% to 35% in its first year, and the RAC and the AA put the loss at around 50% to 60% by the end of year three. After that it sheds a smaller slice each year, levelling out at around eight years old. The tables below model a £20,000 car over ten years, from one that holds its value to one that drops fast.

How much value does a car lose by age?

The main UK sources measure slightly differently, but they all draw the same shape: a steep early drop that flattens with age.

Widely used UK depreciation benchmarks
Milestone	Typical value lost	Who says so
End of year 1	15% to 35%	Motorway, RAC
End of year 3	Around 50% to 60%	The AA, RAC
End of year 5	Around 60% to 70%	Motorway
Years 8 to 10	Around 80%	Motorway

The AA's much-quoted figure is that an average new car loses around 60% of its value in the first three years, assuming roughly 10,000 miles a year, and it puts the first-year loss at around 40%, above the Motorway and RAC range. The RAC puts the three-year milestone at 50 to 60%, and notes values keep sliding until around year eight before levelling out.

Car depreciation by year: the full table

A £20,000 brand-new car on our three profiles. The percentage is how much of the original price is still in the car. Run your own figures in the depreciation calculator.

Projected value of a £20,000 new car, by depreciation profile
Age	Holds value well	Average	Drops fast
1 year	£17,000 (85%)	£15,000 (75%)	£13,000 (65%)
2 years	£15,300 (77%)	£12,750 (64%)	£10,400 (52%)
3 years	£13,770 (69%)	£10,838 (54%)	£8,320 (42%)
4 years	£12,393 (62%)	£9,212 (46%)	£6,656 (33%)
5 years	£11,154 (56%)	£7,830 (39%)	£5,325 (27%)
6 years	£10,038 (50%)	£6,656 (33%)	£4,260 (21%)
7 years	£9,035 (45%)	£5,657 (28%)	£3,408 (17%)
8 years	£8,131 (41%)	£4,809 (24%)	£2,726 (14%)
9 years	£7,318 (37%)	£4,087 (20%)	£2,181 (11%)
10 years	£6,586 (33%)	£3,474 (17%)	£1,745 (9%)

Our three profiles assume a first-year drop of 15%, 25% and 35%, then 10%, 15% and 20% a year of whatever value is left. Real cars flatten out even more as they age, so treat the ten-year figures as the pessimistic end.

What does the car depreciation curve look like?

The same three profiles drawn as a curve: percentage of the original value retained, from new to ten years old. Each one drops steeply in year one, then bends into a gentler slope that keeps flattening.

How much does a used car depreciate per year?

Less than a new one, because the steep first-year drop belongs to the first owner. On our average profile a car loses 25% in its first year, then 15% a year of what is left, so a buyer at three years old starts on the flatter part of the curve.

The same average car bought at three years old for £10,838
Age	Projected value	Lost that year
4 years	£9,212	£1,626
5 years	£7,830	£1,382
6 years	£6,656	£1,174
7 years	£5,657	£999
8 years	£4,809	£848

Over its first three years the £20,000 car shed £9,162. Its second owner, paying £10,838, loses £6,029 over the following five years on the same curve. Same car, a fraction of the pain, which is the whole case for buying at two to four years old.

Which cars hold their value best?

Supply and desirability decide it. The cars that hold on best are the ones people want and cannot easily get: small-run sports cars, sought-after 4x4s and small cars with a name for reliability. Motorway's sales data finds small city cars lose value more slowly than higher-mileage crossovers and SUVs.

At the other end sit big executive saloons and anything sold heavily to fleets. They flood the used market in volume just as their complexity starts to scare private buyers.

Used electric cars had the roughest ride of all. On Autotrader's figures their prices fell year on year for 40 months in a row before levelling off in May 2026, and they have risen year on year in the months since.

Trim and engine matter as much as badge. A sensible mid-spec version of a popular car is usually the sweet spot, while an oddball colour or a thirsty engine can put an otherwise strong model in the fast lane of the table above.

How should depreciation change what you buy?

Depreciation is usually the biggest single cost of running a newer car, more than fuel, tax and servicing together. Before you buy, place the car honestly on one of the three curves and look at what it costs per year, not just the sticker price.

Our running cost calculator puts depreciation alongside fuel, tax and insurance for the full picture.

And remember the curve only tells you what a car sheds, not whether a specific one is worth buying. A cheap car with a hidden history is no bargain. The free MOT check and the £5.00 report tell you what you are actually getting.

Car depreciation: common questions

How much does a car depreciate each year in the UK?

On Motorway and RAC figures, a new car typically loses 15% to 35% of its value in its first year. By the end of year three it is around 50% to 60%, according to the RAC and the AA. The fall then slows, and the RAC reckons values level out at around eight years old. Model, mileage and condition decide where a car sits.

Which cars depreciate fastest?

Big executive saloons, thirsty engines and models that flood the used market shed value quickest, and used electric cars fell in price for more than three years before recovering in 2026. Small cars, desirable 4x4s and sports cars with limited supply hold on best. The same model can sit in different lanes depending on engine and trim.

How much value does a car lose after 5 years?

Around 60% to 70% of what it cost new, on Motorway's figures. In the table on this page a £20,000 car on the average profile is worth about £7,830 after five years. A slow depreciator keeps thousands more, a fast one loses thousands more.

When does depreciation stop?

It never quite stops, but it flattens right out. By eight to ten years old a car sheds a much smaller share each year and eventually settles near a floor set by its usefulness rather than its age. That is why a cheap older car with a solid MOT history can be the cheapest motoring there is.

Is this table a valuation?

No. It is a model of how depreciation typically behaves, using the same three profiles as our calculator. A real car's value moves with its mileage, condition, service history and the market. Use it to compare shapes and set expectations, not to price a specific car.

Figures last reviewed on 23 September 2026.