How to Calculate Car Depreciation Before You Buy

The short answer: calculate a range, not a magic figure

Depreciation is the difference between what you pay for a car and what you receive when you sell it. It is not possible to know the exact amount of a future sale today: it will depend on the vehicle’s condition at that point, its accumulated mileage, its documentation, and the supply and demand at the time.

The useful alternative is not to look for a universal valuation, but to prepare a budget with verifiable assumptions. Start with a realistic purchase price, calculate the mileage the car will have when you sell it, and compare equivalent vehicles that are already close to that age and mileage. Then create three outcomes: favourable, central and unfavourable. The purchase works if you can also afford the unfavourable scenario.

Do not confuse depreciation with total cost of ownership. The former measures only the vehicle’s loss in value. Insurance, fuel or energy, finance, maintenance, repairs, taxes, parking and tolls are separate items. You can later incorporate them into your annual budget with the ownership tool, but it is useful to keep the loss in value visible separately.

• Basic formula: depreciation in euros = purchase price − estimated resale value.
• Annual depreciation = depreciation in euros ÷ planned years of ownership.
• Depreciation cost per kilometre = depreciation in euros ÷ kilometres driven during your ownership.
• The three formulas describe a scenario; they do not certify the future price.

Gather the data before doing the sums

The calculation will only be as good as the starting comparison. Record the exact version, not just the make and model: generation or sales period, date of first registration, body style, fuel type, power, gearbox, trim level and equipment that materially affects the comparison. Also record the current mileage, the annual mileage you expect to drive and the approximate sale date.

For the purchase price, distinguish between the asking price, negotiation and a completed transaction. An advert states an asking price; it does not by itself prove the amount that will be agreed. When buying from a private seller, keep the contract: Spain’s DGT requires it to include, at a minimum, the purchase price and the date and time it was signed. This document allows you to record the price actually agreed for your own calculation.

Add a documentation record to the scenario. The DGT’s full vehicle report allows you to check ITV history (Spain’s periodic vehicle inspection), mileage, number of owners or holders, encumbrances, technical data, recalls and maintenance reported by participating workshops. The DGT recommends requesting it before buying the vehicle to check for possible seizures, impoundment orders, insolvency proceedings or other encumbrances. Do not attribute qualities to an advert that the report or documentation does not support.

Section references: Informe de un vehículo ↗ · Comprar un vehículo de segunda mano ↗

• Expected purchase price and, after purchase, the price actually agreed.
• Complete technical identity: generation, version, engine, power, transmission, trim level and fuel type.
• First registration, current mileage, ownership period and expected annual mileage.
• Documentary status: ITV, encumbrances, available history, servicing and outstanding campaigns.
• Environmental label and the municipality or areas where the car will need to be driven.

Find comparables without mixing cars that only look alike

Group adverts and references by the same generation and version. A shared model name is not enough if the engine, gearbox, trim level or sales period differs. If you mix different vehicles, the resulting average may appear precise, but it will not describe the car you want to buy.

Sort comparables by first-registration date and mileage. To project resale, prioritise those with an age and mileage close to what your car will have at the end of the ownership period. If you cannot find enough, widen the search gradually and note which characteristic you have relaxed; for example, the trim level, but never without making this clear.

Order HAC/1501/2025 publishes average used-vehicle prices for 2026 during the first year after first registration and breaks down entries by sales period and technical data, including engine type, engine capacity and power. It can serve as an additional administrative reference for correctly identifying a technical entry, but it does not replace a market comparison or prove a transaction price.

Exclude or separate adverts whose circumstances you cannot match: vehicles with declared faults, damage, pending documentation, non-comparable use or insufficient technical information. You should also separate asking prices from prices confirmed by contract when you have them. Do not average them as though they were the same evidence.

Section references: Orden HAC/1501/2025: precios medios de venta de vehículos para 2026 ↗ · Comprar un vehículo de segunda mano ↗

• Keep fixed: generation, body style, engine or energy source, power, gearbox and version or trim level.
• Compare the first-registration date and expected final mileage, not only the current figures.
• Create one column for asking price and another for documented transaction price, if known.
• Save the link, date checked and notes for every comparable.
• If the ITV has expired, treat it as a significant condition: the DGT states that the vehicle cannot be driven and must be taken to inspection by tow truck or another authorised means.

Step-by-step method: three resale scenarios

First, calculate the exit mileage: current mileage + (expected annual mileage × years of ownership). This figure determines which comparables you should examine. The selling scenario should look for vehicles close to the resulting mileage, not units with the mileage the car has when you buy it.

Second, set the purchase price you genuinely expect to pay, including only the amounts you decide to include in this item. To avoid mixing concepts, one clear option is to use only the vehicle price for depreciation and record the transfer-of-ownership costs, warranty, finance, delivery, maintenance or repairs in other budget lines.

Third, select a resale value for each scenario. The central scenario can be based on the closest, documentarily equivalent comparables. The favourable scenario can start from the upper part of the comparable set; the unfavourable one, from a lower value you are willing to consider if the sale requires an additional margin. Do not present any of them as a prediction or a valuation.

Finally, calculate the loss in euros, per year and per kilometre. Review which scenario changes your decision: if only the best case makes the purchase affordable, the budget is fragile. You can compare the resulting depreciation of two candidates in the same spreadsheet, alongside their other costs.

Section references: Comprar un vehículo de segunda mano ↗

• 1. Set the purchase date, sale date and expected annual mileage.
• 2. Calculate the expected mileage when selling.
• 3. Gather comparables from that configuration and stage of life.
• 4. Separate advert prices and documented transactions.
• 5. Choose three resale values with a note explaining each assumption.
• 6. Calculate and compare the result before signing.

What can shift the result and how to leave a margin

Condition and traceability should be checked alongside the technical specification. Keep invoices and maintenance records, check outstanding campaigns and retain ITV documentation. The DGT’s full report brings together data that help cross-check mileage, ITV, number of owners or holders, encumbrances, campaigns and maintenance reported by participating workshops; use it to review the vehicle you buy and to gather consistent information about it.

Note any circumstance that makes your unit different from the comparables: declared damage or accidents, higher-than-expected mileage, tyres or items still needing attention, missing documentation or an ITV that is not valid. This does not allow you to quantify a discount automatically; record the documentary differences from the comparables.

Environmental classification also deserves its own line. The DGT explains that labels are used in municipal policies, including traffic restrictions and tax or mobility benefits. Therefore, do not assume that two fuel types or labels will have the same future usefulness for your situation: record where you drive and what applicable restriction or benefit you know about, and update the scenario if it changes.

The final check is not about finding the highest number. It is about deciding whether the depreciation cost in the central and unfavourable scenarios fits your budget, your mileage and the length of time you can keep the car if the sale is delayed.

Section references: Informe de un vehículo ↗ · Distintivo ambiental ↗

• Before buying: request documentation, review the full report and check that the configuration matches the advert.
• During ownership: keep invoices, ITV documents and records supporting mileage and maintenance.
• Before selling: update comparables using the actual age and mileage, not estimates made years earlier.
• If municipal conditions affect your use, adjust the scenario and document the reason.
• Do not accept a deal based only on an optimistic resale value.

New or used: the starting point changes, not the discipline

For a new car, the starting point should be the actual purchase price and an exit reference that already belongs to the same configuration at the age and mileage stage you expect to reach. The 2026 order on average prices includes values for used vehicles during the first year after first registration, a reminder that the first stage must be treated using specific references rather than simply extrapolated from much older cars.

For a used car, the depreciation you will take on starts with the price you pay now, not the price it had when new. This allows you to compare two cars of different ages cleanly: for each one, calculate final mileage, find its own resale comparables and compare the loss in euros and per kilometre during your ownership period.

The common mistake in both cases is to apply a generic percentage by age to any car. A spreadsheet with homogeneous comparables, written assumptions and an unfavourable scenario does not remove uncertainty, but it reveals whether you are paying too much for the resale risk you accept.

Section references: Orden HAC/1501/2025: precios medios de venta de vehículos para 2026 ↗

• For a new car, document the final purchase price and find references for the relevant first stage of use.
• For a used car, start from your purchase price, not its historic new price.
• Do not transfer percentages or values between generations, powertrains or trim levels.
• Update the calculation if your expected mileage or sale date changes.