[B_M_VV]

I just found that features appear to have almost 0 impact on trade-in value, especially on KBB. For 2019 X3, there are basically two trade-in prices (using typical mileage and condition), one for 30i and one for M40i.

For a 30i even if it is fully equipped, its listed trade-in value is at least 5K lower than that of a base model of M40i which had much lower MSRP when new.

Is this true in real transactions? I thought they are similar cars so depreciation, percentage-wise, should be similar, and is proportional to MSRP, but web sites tell a different story.

[sinbad4]

No, it’s not true.. however options count for less than you might guess.

[rmorin1249]

Highly optioned vehicles depreciate more than base vehicles. Basic fact.

[B_M_VV]

Originally Posted by rmorin1249

Highly optioned vehicles depreciate more than base vehicles. Basic fact.

I don't think 15K option should lose 13K value in one year though.

[Supa Koopa]

I can only base this on UK obviously, but yes you generally lose all value in options when trading in a car. Options are for you and not for future value. When I worked in car sales that was standard, no matter what options you had in the car you would just get book price.

I have around £4,000 worth of options on my M40i and I know I won't get any of that back.

[B_M_VV]

Originally Posted by Supa Koopa

I can only base this on UK obviously, but yes you generally lose all value in options when trading in a car. Options are for you and not for future value. When I worked in car sales that was standard, no matter what options you had in the car you would just get book price.

I have around £4,000 worth of options on my M40i and I know I won't get any of that back.

I think there are three possible reasons that cause this, although I cannot quantify their respective impact yet.

1) Technology advancement. Tech-oriented features lose value over the time even on new cars. However, it shouldn't be drastic in short period such as one or two years.

2) People that buy used cars have more tolerance on lack of features, as their previous cars may not be fully loaded. Plus some aim the brand in the first place. So fully loaded cars cannot be priced very high as there is limited demand for them.

3) Dealers have set the standard in this business. Evidence is that in used car market, there is still clear price difference between base model and fully loaded, which indicates there is clear difference in value.

I guess for a fully loaded car, it is better to either drive it for long time and enjoy its features, or sell it in private.

[satz]

Would a better specc-ed car sell better, esp if some key options that people seem to desire, like sunroof?

[clivem2]

Originally Posted by satz

Would a better specc-ed car sell better, esp if some key options that people seem to desire, like sunroof?

Depends on the country I expect. Certainly for previous versions sunroof and pro Nav, xenons were strongly preferred. Current cars are better spec'ed but yes a sunroof will probably be preferred, whether it adds value is another matter.

Someone told me that the packages BMW put together were an attempt to improve residuals along the lines of a SE car being worth more than base. I'm not sure the plan worked...

[Supa Koopa]

Options make a car more desirable to a potential buyer, but they do not affect the trade in value. This is historic and unfortunately will never change as the dealers will keep the cycle going as they can make much more profit from it.

Most of the time you can literally kiss the money goodbye on any option you've added as soon as you drive off the forecourt. This is the way I look at it and then anything else is a bonus. I've only ever noticed BMW change their residual values with some options being added, Audi for example do not change their GMFV at all if you add loads of options.

It's a sad state of affairs but it is what it is. Unfortunately you have to suck it up or try and sell it privately in the hope that someone wants your exact spec of car, or they are going to barter you down by not wanting a black car with sunroof and cream leather, etc, etc. But if it's cheap then they'll buy it...!

[chassis]

What one thinks the market should value and what it actually values are usually not aligned. Suggest getting familiar with the actual market in your area.

Use cargurus, cars.com, Craigslist and other sources to get a feel for asking price. Actual transaction prices will generally be a bit lower. Watch this over time. This is the actual market.

The market values model year, miles, powertrain (horsepower) and condition. Options are a distant fifth.

[X3M40i_Nev]

Originally Posted by Supa Koopa

Options make a car more desirable to a potential buyer, but they do not affect the trade in value. This is historic and unfortunately will never change as the dealers will keep the cycle going as they can make much more profit from it.

Most of the time you can literally kiss the money goodbye on any option you've added as soon as you drive off the forecourt. This is the way I look at it and then anything else is a bonus. I've only ever noticed BMW change their residual values with some options being added, Audi for example do not change their GMFV at all if you add loads of options.

It's a sad state of affairs but it is what it is. Unfortunately you have to suck it up or try and sell it privately in the hope that someone wants your exact spec of car, or they are going to barter you down by not wanting a black car with sunroof and cream leather, etc, etc. But if it's cheap then they'll buy it...!

That is an interesting one Craig, as we found for the Cooper S purchase that we are collecting on Sunday, a loaded Cooper S (2.0) with about £6k options works out cheaper p/m than a modestly specc'd Cooper (1.5), and is on 0% for the 2 years of deal, so they must change the GFV

[Bilbofraggins]

Been at a point for years where we hand down BMWs to our kids...transfer cost is 40 bucks..of course we miss the tax offset, but the family still wins.

For instance...a clean 2015...is going for around 25K here in Canada +15% Tax....Dealer offered 16...I told them no thanks...Then worked the cash deal...It's got to the point where we have taken the dealers out of the equation...The final flip of a car is done on the private sale market...and I won't complain...we have 87,000 km on the F25...28i..our own little experiment to see if she blows....

[Supa Koopa]

Originally Posted by X3M40i_Nev

That is an interesting one Craig, as we found for the Cooper S purchase that we are collecting on Sunday, a loaded Cooper S (2.0) with about £6k options works out cheaper p/m than a modestly specc'd Cooper (1.5), and is on 0% for the 2 years of deal, so they must change the GFV

You're right Nev, I should've said Mini as well. My £4k of options on the X3 added about a grand to the gmv if I remember correctly, trouble is I know it won't make a difference when I come to trade it in early though.

[clivem2]

The list price on my options was £6,785, I got around 20% off that. I don't expect to see any of that money back. I plan to keep the car around 7 years so I'll get to enjoy the options at about £750 per year over my ownership - that's how I've justified it in my head.

[HighlandPete]

Originally Posted by clivem2

The list price on my options was £6,785, I got around 20% off that. I don't expect to see any off that money back. I plan to keep the car around 7 years so I'll get to enjoy the options at about £750 per year over my ownership - that's how I've justified it in my head.

To me, it only makes sense to buy a new car with lots of options, then like yourself, keep it for a good few years. To trade too early is simply throwing money away.

The other option is to buy nearly new, (if you can find the right example), where the options are almost absorbed in the asking price, even from BMW dealers. I've done both, the nearly new vehicle has made best sense financially. Current car had ~£15k of options, bought at just over a year old for about £2k more than the average used price, for examples with one or two key options.

[Bilbofraggins]

+1

[HighlandPete]

Originally Posted by B_M_VV

I think there are three possible reasons that cause this, although I cannot quantify their respective impact yet.

1) Technology advancement. Tech-oriented features lose value over the time even on new cars. However, it shouldn't be drastic in short period such as one or two years.

2) People that buy used cars have more tolerance on lack of features, as their previous cars may not be fully loaded. Plus some aim the brand in the first place. So fully loaded cars cannot be priced very high as there is limited demand for them.

3) Dealers have set the standard in this business. Evidence is that in used car market, there is still clear price difference between base model and fully loaded, which indicates there is clear difference in value.

I guess for a fully loaded car, it is better to either drive it for long time and enjoy its features, or sell it in private.

I simply see it as market forces in action.

Buyers now expect to get a used car with many options for next to base. Dealers may try and load the used price, but still have to work to get an inflated price with most buyers.

Loaded cars are typically easier to sell, both for the owner and the garages. But still has to be at the right price.

[X3M40i_Nev]

Originally Posted by Supa Koopa

You're right Nev, I should've said Mini as well. My £4k of options on the X3 added about a grand to the gmv if I remember correctly, trouble is I know it won't make a difference when I come to trade it in early though.

Yep, any early trading in you will lose. I do t seem to learn and am not a cash buyer like some on here. Cash is king on a used, but to me it often works out the same.

A colleague bought a 1.4 (v.small engine) A4 avant BE for £30k odd cash, and P/X'd (£17k) on a new X4 M Comp (all the deals end of 2019) and quite an upgrade. They worked out the Audi cost them £650p/m so were well pleased the new car was "only" £549, and they had 2 years odd worth of payments in the bank.

Whichever way you do it, they do depreciate BIG time

[chassis]

Originally Posted by HighlandPete

To me, it only makes sense to buy a new car with lots of options, then like yourself, keep it for a good few years. To trade too early is simply throwing money away.

The other option is to buy nearly new, (if you can find the right example), where the options are almost absorbed in the asking price, even from BMW dealers. I've done both, the nearly new vehicle has made best sense financially. Current car had ~£15k of options, bought at just over a year old for about £2k more than the average used price, for examples with one or two key options.

Agree with this.

[Bilbofraggins]

Yes and No...there is something to be said to picking up vehicles from the dealer that were "used" up to 2 years old, getting an extra 2 year certified thrown-in and paying no more than 50% ish...Been there done that a few times...but the certified piece is not what it was....

I still own my 2013 X6M picked-up that way...and still love it...

The latest edition was a "used " X3 M40i...with 53km....it was much harder to work the certified extra warranty...but we ended up with 7 Years 140,0000kM...at a cost I was happy with. And of course with the 4 years maint we get here. That leftover 2019...worked out at almost 25% ($18,000) off...for what is a new vehicle...

It's for these reasons, at the end of the day, I don't think I'll ever properly appreciate leasing. Especially after a belly full of wings and beer...

[Oldguysrule]

Firmly believe buying low mileage 1-2 year old vehicles is an economical approach. My m40i was 2 years old, 13K miles nicely optioned. Over 30% less than retail when new. I too can't warm up to a lease.

[HighlandPete]

Originally Posted by Oldguysrule

Firmly believe buying low mileage 1-2 year old vehicles is an economical approach. My m40i was 2 years old, 13K miles nicely optioned. Over 30% less than retail when new. I too can't warm up to a lease.

Buy carefully and there are some bargains out there. I know I'm talking from a UK perspective, but I got my current 5-series at just over one year old, less than 6k miles, for 40% off list. Other than my first choice of paint colour, more or less the spec I'd have ordered new.

As a low annual mileage user, makes even more sense for me to buy nearly new. Keeps the cost per mile to a minimum.