Depreciation
The decrease in value of an asset over time due to wear, age, or market conditions.
What You Need to Know
Depreciation is the natural decline in value that most assets experience over time. For vehicles like camper vans, depreciation is typically highest in the first few years.
Vehicle Depreciation Patterns:
- Year 1: 15-25% value loss (highest depreciation)
- Years 2-5: 8-15% annual depreciation
- Years 6+: 5-10% annual depreciation
Factors Affecting Depreciation:
- Brand reputation: Mercedes Sprinter holds value better than Ford Transit
- Condition: Well-maintained vehicles depreciate slower
- Mileage: Higher mileage = faster depreciation
- Market demand: Popular models hold value better
- Professional vs DIY: Professional conversions typically hold value better
Depreciation Impact on Loans:
- Early loan years: You may owe more than the vehicle is worth
- Gap insurance can protect against this risk
- Larger down payments reduce depreciation risk
Minimizing Depreciation:
- Choose vehicles with strong resale value
- Maintain excellent condition
- Keep mileage reasonable
- Consider certified pre-owned options
Sources & References
This information is sourced from authoritative government and academic institutions:
- irs.gov
https://www.irs.gov/publications/p946
Related Calculators & Tools
Put your knowledge into action with these interactive tools:
Auto Depreciation Calculator
Project vehicle value over time using brand, mileage, condition, and segment factors. Compare resale value scenarios up to 10 years.
New vs Used Car Calculator
Compare total cost of ownership including depreciation, repairs, insurance, and financing