STATEN ISLAND, N.Y. — With new car prices well above what consumers had grown accustomed to in recent years, making sure your car maintains its value is more important than ever.
However, what many prospective buyers may not know is that the color of your car could have an effect on how much its value depreciates in the coming years.
A study from automotive research firm iSeeCars.com analyzed over 6 million new and used car sales from 2017 through 2020 to determine which color cars depreciated in value the most and least within the first three years.
“A vehicle’s color is among the primary considerations after shoppers have decided on a make and model,” said iSeeCars Executive Analyst Karl Brauer. “With resale value being the single biggest factor in how much a new vehicle ‘costs’ over the course of ownership, consumers should carefully consider their color choice.”
Car buyers may be surprised to learn that some of the most commonly seen colors on the road tend to lose more value in the first three years than those that are seen far less frequently.
“There’s a bit of a self-fulfilling prophecy going on here, with many consumers picking these mainstream colors not because they like them, but because they assume everyone else does,” Brauer said. “This makes white, black and silver appear to be in high demand, yet our analysis confirms that more obscure colors tend to hold their value better than common and popular colors.”
For example, yellow and orange ranked first and third, respectively, in terms of least depreciation over the first three years of ownership, due to their limited availability and the fact that these colors are typically seen on highly coveted models.
“Yellow may not be a widely desired car color, but there are enough people who want yellow, versus the number of yellow new cars being ordered, to make yellow cars more desirable than others on the used market,” said Brauer. “Like yellow, orange is most often found on low-volume sports and muscle cars.”
Meanwhile, more common colors like black, white and silver all tend to depreciate at an average rate, due to the sheer volume on the market.
“Because there are so many of these vehicles in the used car marketplace, buyers can shop around more easily if they’re interested in these colors, reducing the amount of pricing power for dealers,” Brauer noted. “This means black, white and silver are the safe colors to buy if you’re satisfied with average value retention, but not if you’re trying to do better than average.”
The study found that the average new car, regardless of color, tends to depreciate by about 37.6% over the first three years.
Here’s a look at the depreciation rates of different color cars, from lowest to highest depreciation percentage.
- Yellow – 20.4% three-year depreciation rate
- Beige – 22.8% three-year depreciation rate
- Orange – 27.1% three-year depreciation rate
- Green – 31.3% three-year depreciation rate
- Gray – 36.4% three-year depreciation rate
- Red – 36.9% three-year depreciation rate
- Blue – 37.0% three-year depreciation rate
- Silver – 37.6% three-year depreciation rate
- White – 38.0% three-year depreciation rate
- Black – 38.4% three-year depreciation rate
- Purple – 41.2% three-year depreciation rate
- Brown – 42.1% three-year depreciation rate
- Gold – 45.6% three-year depreciation rate