Re: Z4 for SALE
why not use depreciation?
why not use depreciation?
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Z4 for SALE
- Thread starter janine
- Start date
leebmer
Well-Known Member
Re: Z4 for SALE
agree, depreciation seems a good approach...because whether PI or used PI, u can work out the annual depre and compare it with the same model selling as 2nd hand in local market...
annual depre = (selling price - 0.5 of OMV)/no. of yr left
diablo_728;519889 said:
agree, depreciation seems a good approach...because whether PI or used PI, u can work out the annual depre and compare it with the same model selling as 2nd hand in local market...
annual depre = (selling price - 0.5 of OMV)/no. of yr left
hoks
Well-Known Member
Re: Z4 for SALE
If one buys the car now and drive for another 5 years, it will be coming 8 yrs old. Still can fetch 75k?
If one buys the car now and drive till its 5th year, per your assumption sell @ 75k, that will be 45k down in 2yrs+ of ownership.
Juz a little confused.
Don't mind, could you clarify the part on "during year 5"?janine;519878 said:
If one buys the car now and drive for another 5 years, it will be coming 8 yrs old. Still can fetch 75k?
If one buys the car now and drive till its 5th year, per your assumption sell @ 75k, that will be 45k down in 2yrs+ of ownership.
Juz a little confused.
Re: Z4 for SALE
Hi,
Let me apologise again. Year 5 refers to the fifth year of the car's life. What I meant was purchase price less re-sale price divided by number of years consumed.
So (120-75)/36mths = 1250 per month. Perhaps depreciation isnt the best term to use, but this will be the value being eroded per month.
If u buy a full omv car, u may enjoy a higher resale price but you also have to pay a higher upfront (which comes with higher interest and insurace). Then the problem comes back to whether you can sell at a value higher than PI cars in the 5 yr old car market - a very tricky problem. Just browse through sg carmart to see what the list prices for 5 to 8 yr old cars are like. Its pretty hard to associate higher omv with higher mkt value.
For e.g. say if I pay 130k for a full omv car and end up selling at only 80k in 3 yrs time, the amount of depreciation will be 130-80/36=1388 per month. This is higher than the above scenario
not to mention the higher interest and insurance I have to pay
Those who trade or learn acctg will understand this through "residual value" and "market value"
Interesting discussion here !
Hi,
Let me apologise again. Year 5 refers to the fifth year of the car's life. What I meant was purchase price less re-sale price divided by number of years consumed.
So (120-75)/36mths = 1250 per month. Perhaps depreciation isnt the best term to use, but this will be the value being eroded per month.
If u buy a full omv car, u may enjoy a higher resale price but you also have to pay a higher upfront (which comes with higher interest and insurace). Then the problem comes back to whether you can sell at a value higher than PI cars in the 5 yr old car market - a very tricky problem. Just browse through sg carmart to see what the list prices for 5 to 8 yr old cars are like. Its pretty hard to associate higher omv with higher mkt value.
For e.g. say if I pay 130k for a full omv car and end up selling at only 80k in 3 yrs time, the amount of depreciation will be 130-80/36=1388 per month. This is higher than the above scenario
not to mention the higher interest and insurance I have to pay Those who trade or learn acctg will understand this through "residual value" and "market value"
Interesting discussion here !
e46sg
Well-Known Member
Re: Z4 for SALE
Hi,
guys was just reading through the various posts and save for a couple of useful clarifications, i don't think any of you are genuinely interested in purchasing the car?
Perhaps then we should not clock up 3 pages of conversations which does not help our friend sell his car?
Hi,
guys was just reading through the various posts and save for a couple of useful clarifications, i don't think any of you are genuinely interested in purchasing the car?
Perhaps then we should not clock up 3 pages of conversations which does not help our friend sell his car?
