Used vs New Car — cost comparison
Compare the real cost of owning a new and a used car over your chosen period — depreciation plus servicing. New loses value faster; used can cost more in repairs.
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Cost of ownership = value lost + servicing × years. Depreciation uses a constant annual rate (it ignores the steeper first-year drop, which in reality favours buying used). Excludes fuel and insurance.
How we compare used and new
The calculator compares the cost of owning each car over your period: the value it loses plus annual servicing and repairs. Value lost = price × (1 − (1 − rate)^years) — the higher the price, the bigger the loss in money.
A new car loses more value (higher base) but usually costs less in repairs (warranty). A used car is the opposite: less value lost, higher servicing. The calculator shows which works out cheaper overall.
Formula
- Value lost = price × (1 − (1 − rate)^years)
- Cost of ownership = value lost + servicing × years
- Comparison = cost of new vs cost of used
- Upfront difference = new price − used price
Frequently asked questions
Does a new car always lose more?
In value, usually yes — it loses the same percentage from a higher price, and the drop is steepest in the first years. But a new car has lower repair costs and a warranty, so overall it isn't always more expensive.
Why is buying used often worth it?
The first owner absorbs the biggest value loss (up to 40–50% in three years). Buying a 2–3 year old car skips that drop, though expect higher servicing costs and a shorter warranty.
What does the calculator ignore?
Fuel, insurance, finance costs and the risk of a major fault on a used car. It models depreciation with a simplified constant annual rate — in reality a new car loses most in year one.
Is my data sent anywhere?
No — everything is calculated locally in your browser.
Used vs new: comparing the total cost of ownership
The new-versus-used decision is a trade between depreciation and repairs. A new car loses value fast but rarely needs more than servicing; a used car has already shed the steep depreciation but carries higher and less predictable maintenance. The calculator above puts both on one scale: value lost over your ownership period plus servicing and repair costs, for each car, side by side.
Worked example
Over three years: a new car at £30,000 losing 15% a year ends up worth about £18,424 — £11,576 of depreciation — plus, say, £350 a year of servicing: roughly £12,626 total. A three-year-old equivalent at £15,000 losing 10% a year loses about £4,065, and even with a heavier £700 a year of servicing and repairs the total is about £6,165. The used car wins by more than £6,000 — and that is with a generous repair budget. The gap narrows for brands with poor reliability or for buyers who keep cars a decade.
What the headline numbers hide
- Warranty has real value. A new car’s 3–7 year warranty converts repair risk into zero; price that certainty honestly when the totals are close.
- Finance rates differ. Manufacturers subsidise new-car finance (0–5%) while used loans cost more — if you borrow, compare total credit cost, not just the car prices.
- The sweet spot is usually 2–4 years old: the first owner paid the depreciation cliff, remaining warranty often applies, and modern cars at 30,000 miles are barely run in.
- Insurance and tax are not equal — newer cars can cost more to insure but less to tax; a £150/year difference across the totals is worth entering.
- Very old cars flip the logic again: negligible depreciation but repair lumpiness — a £2,500 car needing a £900 gearbox is a familiar story. Average repairs honestly.
Additional questions
Is buying new ever the rational choice?
Yes: if you keep cars 8–10+ years, the first-year cliff amortises into irrelevance and you get the full reliable life, exact spec, and today’s safety tech. New also wins where subsidised finance or salary-sacrifice schemes apply, and for some EVs with strong incentives.
How do I estimate repair costs for a used car?
Use owner-club and reliability-survey figures for the specific model and engine, not the brand’s reputation. Budget more for the first year (deferred maintenance from the previous owner) and always deduct the cost of any timing belt, clutch or tyres due soon from the price you offer.
Nearly-new (pre-registered) cars — catch or bargain?
Often genuine value: 10–20% off list for delivery mileage. Check that the warranty started at first registration (you lose a few months), that you become the second owner on paper, and that the spec is really what you would have ordered.
Written & fact-checked by Łukasz Wójcik — independent developer, not a licensed financial adviser. Last reviewed: 2026-08-17.
Methodology & assumptions
This estimate is based on the figures and assumptions you enter (purchase price, running costs, mileage, depreciation rate) — actual costs vary by specific vehicle, condition, location and market, and this is not a valuation of any individual vehicle.
Scope & limitations
This calculator is a free, general-purpose estimation tool. It uses simplified assumptions, does not know your full personal or financial circumstances, and is not a substitute for professional financial, tax or legal advice. Figures can change after publication — always check the current rate or threshold at the source below before relying on a result.
Where to check this yourself
Every rate, threshold and rule used above comes from the bodies below. They are the authority; this page is not. Where a figure here disagrees with a source, the source is right — and we would be grateful if you told us. Links go to official government bodies and to registered charities that give free, impartial guidance; none of them pays us and we take no commission.