A brand-new car loses somewhere around 20 percent of its value the moment it’s driven off the lot with a new title, and unless somewhere down the line it’s deemed “collectible,” the value will continue to dwindle to essentially nothing.
I posted earlier about how Cash-for-Clunkers, by driving up the values of used cars, would hit Rhode Islanders because Rhode Island municipalities tax car ownership based on the Blue Book value at December 31 of the prior year.
We just received our tax bill for this fiscal year, and three of our four cars rose in value for tax purposes, even though the cars are a year older.
Rather a lot, in the case of one of them:
The largest percentage gain was in a 2000 Honda Odyssey with over 200,000 miles on it, which is on death watch. The value rose from $2,800 to $3,849, costing us an extra $44.12.
Geez. I wonder if my car (just as old, but not quite so used) is worth 37 percent more than it was last year. Since I didn’t actually check it last year, though, I can’t really run a comparison. (Still, $5,840 seems a bit high, even allowing for condition, which is, as the record-raters say, mint-minus to VG+.)