What is retail and Trade value for 2nd hand vehicles?
I have been debating this case for many months. To date I still cannot figure this out.
Trade value is what you are offered for your vehicle when wanting to upgrade the vehicle or if you are wanting to sell the vehicle to your prime dealership. They would then put in and offer which is what they would call book value. Once the vehicle is purchased at book value it would be retailed at a higher price for the dealership to benefit from the deal as well.
Retail value is usually higher than trade value and it all depends on the mileage, make and model of the vehicle as well.
By saying all of this how do we determine what the value of any 2nd hand vehicle is for that matter? If I browse all the local sites, vehicles are posted mostly in similar brackets, for a certain brand. E.g. a Toyota Tazz would retail between 30-50k depending on year model of the vehicle and sometimes mileage on the vehicle. However, do we consider the fact of wear and tear on the vehicle? If the seats were worn, vehicle needs mechanical attention and body not that good. How do we determine if that vehicle is sold at a bargain price? Our prices differ mechanically, upholstery and spray job on vehicles. If you were to pay R3000 for a spray job it could cost other persons for the same amount of work maybe R 10 000. So let’s say I paid R30 000 for a Tazz for a 2002 model with under 200 000 km’s on it, and the same brand, year model, and approximately the same mileage sells at 40 000. What would be the better option on the vehicle? The R30 000 Tazz or the R40 000 Tazz? This is what I debate all the time with various people. Sometimes in our mind we look at Trade value of the vehicle or retail value or even browse our local websites for a good estimate of our vehicle. Is this approach the correct manner of determining a guide line price for 2nd hand vehicles?
Please state your opinion or experiences with us.
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