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Understanding the Game: Key Factors That Drive Car Valuation in Today’s Market

man driving a car

from the Gumtree Team

26 Oct 2023 4 mins read

Whether you’re looking to buy or sell a car, it’s important to understand what factors influence car valuation in the current car market. 

Being aware of the key factors that impact car valuation can help you to understand your car’s worth, set a competitive asking amount, sell your car faster and get the best price. 

How Can I Get a Car Valuation?

There are several different ways to get a used car valuation. Some of the most popular options for car valuation in Australia include: 

Online Car Valuation Calculator 

Online tools for car valuation give price estimates based on data-driven algorithms and market data. Some of the pros of using an online car valuation calculator include: 

  • Quick: Once the details about the car are input, the value estimate is given instantly. 
  • Convenient: Online valuation calculators are free and can be utilised from anywhere, any time with an internet connection. 
  • Transparent: Online calculators provide a transparent valuation process that can be used to justify your asking price to interested buyers. 
  • Accurate Estimates: While not infallible, online calculators often provide reasonably accurate estimates based on the information provided.

Dealer Trade-In Valuation 

A trade-in value is the price a dealer is willing to pay for a used car. This price is used as a credit towards the seller’s new car. Here are just a few things to keep in mind before you take your car in for a trade-in valuation:

  • Convenience: As a seller, you can sell your old car and buy your new car in one place. 
  • Lower Price: This price is often lower than market value, as the dealer takes into consideration costs associated with reselling the vehicle. 
  • Limited Flexibility: Not as much flexibility for negotiation when compared to selling a car privately. 

Independent Valuer

A professional appraisal can be undertaken to determine the value of a car. Before you choose to get your car professionally appraised, here are some things to consider: 

  • Accuracy: A professional appraisal is often very accurate, as the appraiser can assess the car’s condition and unique features. 
  • Costly: There is a cost associated with professional appraisals. 

Car Price Guide

Otherwise known as a ‘book value’, a car price guide is a publication that lists various cars and their value. Here are the things to remember before you get value for your car with a car price guide:

  • Simple to Refer to: Making it user-friendly. 
  • Subjective Accuracy: Price guides aren’t always upgraded frequently enough to reflect current market trends. 

The Importance of an Accurate Car Valuation

Car valuation is vital for those selling used cars as it determines the vehicle’s worth in the market. 

By obtaining an accurate valuation, sellers can ensure they set a price that reflects the car’s true value, ensuring they receive the best possible price while also making sure the buyer is paying a fair amount. This valuation also enables sellers to set competitive prices, which not only attracts potential buyers but also paves the way for quicker and more transparent transactions. 

On top of this, sellers who are well-informed about their car’s valuation can approach negotiations with greater confidence, enhancing their chances of securing the right price. Beyond the buying and selling realm, an accurate car valuation plays a crucial role in determining insurance premiums, loan approvals, and refinancing rates, as it establishes the vehicle’s insured value.

Different Factors Affecting Car Valuation

It can be tricky to set an asking price range when selling a vehicle, as the value of a car can differ depending on specific and unique conditions and features. 

Some of the factors that affect car worth include: 

Age of the Car 

The year the car was manufactured impacts the value of a car and can sway interested parties. 

  • Depreciation: Generally, the older a car, the lower its value. Depreciation is a significant factor in determining a car’s worth.
  • Vintage Exceptions: Some vintage models increase in value over time. 


fuel gauge with a red needle

The total mileage covered in a vehicle should be considered when determining the value of a car. 

  • Less Kilometres Travelled: Lower mileage often leads to a higher valuation, as it indicates less wear and tear.


The overall condition—aesthetically and mechanically—of the car can significantly impact its value.

  • Good Condition: Well-maintained vehicles are worth more. Aesthetics and function both contribute to the overall condition of a car. 
  • Interior: The presentation and functionality of the interior including leather seats, floor mats, centre console and other internal features all contribute to the overall condition of the car. 
  • Exterior: The condition of the exterior of the car related to the paint, any dings or dents, tyre thread and even cleanliness can significantly influence the value of a car. 
  • Mechanical: The condition of the engine is important to evaluate in the event of determining the value of a vehicle. An engine that’s in good working order with a sound service and repairs history is worth more than an engine in poor working order without documentation of service and repairs. 

Make and Model

The brand and model of a car play an important role in determining its value. 

  • Resale Power: Some brands are associated with higher resale values due to their reputation for reliability and quality.
  • Demand: Sometimes demand for a particular make or model outweighs supply from dealers. In this case, secondhand vehicles in that make and model can be more valuable to buyers. 

Vehicle History

A well-documented vehicle history is important for buyers to be able to see and understand the history of the vehicle. 

  • Accident History: Cars with a history of accidents or significant damage are typically valued lower.
  • Service History: A comprehensive service history is viewed favourably by buyers and can drive up the value of a car. Solid service records show the car has been well-maintained and is less likely to experience big issues down the track. 
  • Ownership Changes: If the car has had more than one owner, this can affect the value of the car. A car that’s had multiple owners has likely been subjected to various levels of care and different driving styles over time. A vehicle that has only had one previous owner is often seen as a positive by potential buyers. 


The preferences of buyers in the location of the vehicle can influence the value it carries on the used car market. 

  • Regional Variations: Car values can vary by region due to factors like climate, local preferences, regional demand and market conditions.

Current Market Trends

Current market trends and demand for specific types of vehicles can influence their value. 

  • Market Demand: Certain types of cars may go through periods of becoming more popular, such as hybrid and electric vehicles during times of rising fuel prices. Cars currently popular in the secondhand market fetch a higher sale price. 
  • Supply and Demand: If there’s a lot of demand for purchasing secondhand cars, this can drive up the value of a car on the market. 
  • Seasonality: Some cars are more popular in different seasons, such as convertibles in the summer. 

Upgrades and Special Features

Extra features and upgrades can increase a car’s value.

  • Tech: Advanced technology, especially related to safety and user connectivity, can increase the value of a car. 
  • Sound Systems: Premium or upgraded sound systems can draw more value to a vehicle. 
  • Customisation: Unique customisations and aftermarket accessories can influence the value of a car. Some customisations can increase the value of a car, but other unusual customisations may decrease the value. 

Selling Your Car Online with Gumtree

Gumtree is a popular online marketplace and a convenient and effective platform for selling and buying secondhand vehicles

Gumtree Car Valuation

Our free car valuation calculator can help you instantly determine a value range for your car to help you understand how much it’s worth on the open market. 

  • Instant: Determine your selling price quickly and easily with the help of our instant valuation calculator.
  • Easy to Use: Simply input your state and car registration, or the make, model, year, vehicle variant and engine details, and Gumtree’s car valuation tool will give you a value estimate for your vehicle. 
  • Available for Buyers: Anyone can use our online valuation tool. It can act as a justification for your asking price when negotiating with interested buyers. 

Selling Online with Gumtree Australia

As a popular online classifieds platform, it’s simple to buy and sell with Gumtree. 

  • Wide Audience: Our large user base means we can put your listing in front of the right interested buyers to help make the sale process faster and smoother. 
    • User-Friendly: Our platform is user-friendly, making it easy to create and manage your car listing, even if you’re not tech-savvy.
    • No Middleman: Selling on Gumtree eliminates the need for a third party, potentially allowing you to get a higher price for your car by dealing directly with buyers.
    • Control Over Your Listing: You have full control over the content of your listing, including detailed descriptions and high-quality images to present your car in the best light.
  • Negotiation Power: You have full negotiation power to decide what sale price you’re happy to accept. 
  • Flexibility: You can adjust the listing, price, and listing details at any time to adapt to changing market conditions or buyer preferences.
  • Direct Communication: We facilitate direct communication with potential buyers, allowing you to address their questions and negotiate terms personally.

Confidence About the Value of Your Car

Understanding the factors that influence the accurate valuation of cars empowers sellers to set competitive prices, attract trustworthy buyers, and support efficient transactions. For buyers, it ensures informed decisions and negotiations based on a car’s true worth. 

Online tools such as Gumtree’s free valuation calculator are useful in determining a value range for your car, making it simple to understand the current value of your car.

On the other hand, if you’re looking to buy a second hand used car, then make sure you read our extensive used car buying guide for tips, info and advice.