Value Your Car

by Don Elliott on May 17, 2011

As a private seller, you can offer your car for sale at whatever price you would like. However, value your car too high and you might not attract any buyers. Value your car too low and you will definitely sell it, but leave money on the table. A friend of mine once told me, “The best priced cars are the ones sold by mistake!”

How do you determine the price in the middle that is good for you and good for the buyer? Checking your local classifieds, cars.com, autotrader.com, and edmunds.com are all excellent resources to find the “book” price for your car.

To find the best used car value for your car, let’s walk through the process with an actual car. We’ll use a 2002 Chevrolet Suburban 2WD with 161,000 miles. This car is in good shape but needs a set of tires. There is a small dent in the left rear quarter panel that needs repaired at an auto repair shop. This SUV has the LT package and leather quad captain’s chair seating. For this example, we will use Kelley Blue Book to find our used car value.

Guidebook prices adjust as the market changes. Estimates are based primarily on historic data, or the price similar vehicles have sold for over the last six weeks or less. Historic data is blended with market trends to predict the fair market used car value at any given point in time.

Similar to other guidebooks, Kelley Blue Book has three different ways to value your used car; trade-in value, private party value and suggested retail car value. They are listed in fair, good and excellent values. A car in excellent condition looks like new, has not had any paint or body work, a clean title history, runs well and has a complete set of service records. Not very many nine-year old cars are in excellent condition.

This particular Suburban is in good condition except for the small dent and it needs a set of tires. There is no rust and is in otherwise good mechanical and cosmetic condition.

The trade-in value is $4,900. The private party value is $6,470. The suggested retail value for this SUV in excellent condition (meaning a car dealer has reconditioned the car to qualify it as “excellent” condition) is $8,845.

Realizing that this SUV needs tires for $700 and body repair of $250, I would reduce the private party “good” condition value by $950 or a price of $5,520. Looking closer, all of the miles on this car were highway miles. It has the more fuel-efficient 5.3-liter engine and has the service records to show that it has been running on synthetic motor oil for most of its life and gets 17 MPG. The current cost of gasoline is a minor concern but shoppers for large SUVs are generally buying this sized vehicle for something that cannot be done with a smaller car. It is okay to add some money to the asking price to allow for negotiation. Ten percent is an acceptable amount. Plus, this is a really nice vehicle that will show well.

I estimate a good asking price for this 2002 Chevrolet Suburban to be $6,300. A reasonable final selling price would be somewhere around $5,750. If we tried to sell this car to a dealership, I would expect an offer of about $4,800.

Let the selling begin! Send us your comments about your efforts to value your used car.

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