How much is a clean Carfax worth?
Thread Starter
Racer
Joined: Aug 2013
Posts: 487
Likes: 21
From: Minnesota
How much is a clean Carfax worth?
How much is a clean Carfax report worth?
I was in an accident recently (someone pulled out of a blind alley and hit me). There was no frame damage, and everything will be fixed up as good as new. Nevertheless, it's the first accident for this car, and I'm pursuing a diminsihed value claim.
Establishing the value of my car is pretty straightforward. It's a plain vanilla 1995 C4, and I'm comfortable using completed sold e-bay listings as a valid comparison. Based on that method, the car's value is approximately $41k.
I'm having trouble finding data on how much value has been diminished. It's easy to find salvage-title cars, and it's easy to find cars advertised as no-accident, but it's hard to find comparable cars with an accident history mentioned in the listings.
So - here's my question: There were two identical cars in appearance and performance. You know that one has an accident history. What percentage price difference would you expect between the two cars?
I know that someone is going to ask "Depends on the accident." I don't know how Carfax reports accidents (or more specifically, how mine will be reported), so if you get hung up on the severity, then you can answer these bonus questions:
If all you know is that the accident is described as "minor", what percentage difference would you expect?
If it is described as "moderate"?
If it is described as "major"?
Obviously, for the right buyer and the right car, an accident history won't matter. I'm trying to give the insurance company some market data to consider, more than just my personal opinion of how the market values accident vs non-accident histories. I did some searches and looked through the pricing thread, but didn't find anything specific to my question.
Thoughts? Thanks!
EDIT: Please see Post #12 below for a revised pricing scenario.
I was in an accident recently (someone pulled out of a blind alley and hit me). There was no frame damage, and everything will be fixed up as good as new. Nevertheless, it's the first accident for this car, and I'm pursuing a diminsihed value claim.
Establishing the value of my car is pretty straightforward. It's a plain vanilla 1995 C4, and I'm comfortable using completed sold e-bay listings as a valid comparison. Based on that method, the car's value is approximately $41k.
I'm having trouble finding data on how much value has been diminished. It's easy to find salvage-title cars, and it's easy to find cars advertised as no-accident, but it's hard to find comparable cars with an accident history mentioned in the listings.
So - here's my question: There were two identical cars in appearance and performance. You know that one has an accident history. What percentage price difference would you expect between the two cars?
I know that someone is going to ask "Depends on the accident." I don't know how Carfax reports accidents (or more specifically, how mine will be reported), so if you get hung up on the severity, then you can answer these bonus questions:
If all you know is that the accident is described as "minor", what percentage difference would you expect?
If it is described as "moderate"?
If it is described as "major"?
Obviously, for the right buyer and the right car, an accident history won't matter. I'm trying to give the insurance company some market data to consider, more than just my personal opinion of how the market values accident vs non-accident histories. I did some searches and looked through the pricing thread, but didn't find anything specific to my question.
Thoughts? Thanks!
EDIT: Please see Post #12 below for a revised pricing scenario.
Last edited by 993Mpls; May 18, 2015 at 03:10 PM.
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I have a few thoughts.
One is, good luck getting a diminished value claim paid by an insurance company. The law varies from state to state, but generally the insurance company is only required to repair your car. From a legal standpoint, once the car is properly fixed, you are made "whole", legally. They are not going to just hand you money above and beyond that. Rarely I suppose it could happen, but often requires hiring an attorney and a lengthy process. Even then, the law may be on their side. Plus, even if you prevail, there's a good chance your pay out would be small and eaten up by attorney's fees etc.
Think about it this way: Insurance companies are billion dollar businesses, and their job is make as much money as possible. It is in their interest to deny you anything and everything they can. Everyone who is hit by another wrongful driver has a car that now is worth less that before they were hit. Does everyone get their car fixed, plus a diminished value pay-out? Nope. Insurance companies have great lawyers who are skilled at this, and oh yes, they lobby (bribe) your government to make sure claims like yours are not paid.
Don't get me wrong, I would love to see you get a diminished value settlement, but don't get your hopes up. The system is rigged to make sure you don't succeed at that. Otherwise every driver will be entitled to a diminished value payout when they are hit.
The second is, Carfax is great if you see an accident on it. Thing is, a car could have several accidents and none could show up on a Carfax quite easily. Your accident may not show up on a Carfax. Often they do not. Savvy buyers know not to rely on Carfax as it is wholly unreliable.
I wish you lots of luck and sorry to hear about your accident. The main thing is you're OK
One is, good luck getting a diminished value claim paid by an insurance company. The law varies from state to state, but generally the insurance company is only required to repair your car. From a legal standpoint, once the car is properly fixed, you are made "whole", legally. They are not going to just hand you money above and beyond that. Rarely I suppose it could happen, but often requires hiring an attorney and a lengthy process. Even then, the law may be on their side. Plus, even if you prevail, there's a good chance your pay out would be small and eaten up by attorney's fees etc.
Think about it this way: Insurance companies are billion dollar businesses, and their job is make as much money as possible. It is in their interest to deny you anything and everything they can. Everyone who is hit by another wrongful driver has a car that now is worth less that before they were hit. Does everyone get their car fixed, plus a diminished value pay-out? Nope. Insurance companies have great lawyers who are skilled at this, and oh yes, they lobby (bribe) your government to make sure claims like yours are not paid.
Don't get me wrong, I would love to see you get a diminished value settlement, but don't get your hopes up. The system is rigged to make sure you don't succeed at that. Otherwise every driver will be entitled to a diminished value payout when they are hit.
The second is, Carfax is great if you see an accident on it. Thing is, a car could have several accidents and none could show up on a Carfax quite easily. Your accident may not show up on a Carfax. Often they do not. Savvy buyers know not to rely on Carfax as it is wholly unreliable.
I wish you lots of luck and sorry to hear about your accident. The main thing is you're OK
Thread Starter
Racer
Joined: Aug 2013
Posts: 487
Likes: 21
From: Minnesota
The important things are all ok - no one was hurt and my car will be as good as new. I agree with you about insurance companies, but I think I have a case for it and I wasn't going to *not* mention the issue simply because it's me vs Huge Ins Co, you know?
I don't mean to fixate on Carfax. There's always a lot of discussion about car valuation, and I think it would be interesting to see if there is any consensus around what a ding or two does to values.
Someone - it might be you, Goof - often points out that at this point, most cars *have* been in an accident, since they're all 20 years old and most have had at least a few owners. So maybe the market doesn't devalue for accident history. I think it does and I'd like to hear some thoughts on how much to see if I'm in tune with the market.
Who knows, maybe this will help John Ireland negotiate down to a purchase price he thinks is reasonable!
I don't mean to fixate on Carfax. There's always a lot of discussion about car valuation, and I think it would be interesting to see if there is any consensus around what a ding or two does to values.
Someone - it might be you, Goof - often points out that at this point, most cars *have* been in an accident, since they're all 20 years old and most have had at least a few owners. So maybe the market doesn't devalue for accident history. I think it does and I'd like to hear some thoughts on how much to see if I'm in tune with the market.
Who knows, maybe this will help John Ireland negotiate down to a purchase price he thinks is reasonable!
Last edited by 993Mpls; May 18, 2015 at 02:43 PM. Reason: fixed typos
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From: DC area
If the seller didn't fully disclose the details of a "minor" accident, I'd walk away or inquire what was fixed/replaced on the car. Then, it depends on how the repair was made.
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Market devalues for accidents only if they're known. A clean Carfax doesn't mean a car hasn't been hit, maybe even several times.
Also, it would be very difficult to find any 993 that has pristine original paintwork, except for maybe a low mile garage queen.
Also, it would be very difficult to find any 993 that has pristine original paintwork, except for maybe a low mile garage queen.
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Thread Starter
Racer
Joined: Aug 2013
Posts: 487
Likes: 21
From: Minnesota
And, given two identical cars, except for one was in a known accident, what percentage price differential would you expect to see? If the accident was described as "minor", or "moderate", or "major"?
I guess I'll throw my hand down - knowing nothing else about the cars, I'd expect a 10% - 20% differentiial, and then adjust up or down when I learn specifics about the car.
Note that I'm not saying that a car with a history will always sell for 20% less. If I find out enough, I might end up paying/ valuing the accident car identical to a non-accident car. I'm saying that my first expectation is the value is reduced by 10-20%.
I guess I'll throw my hand down - knowing nothing else about the cars, I'd expect a 10% - 20% differentiial, and then adjust up or down when I learn specifics about the car.
Note that I'm not saying that a car with a history will always sell for 20% less. If I find out enough, I might end up paying/ valuing the accident car identical to a non-accident car. I'm saying that my first expectation is the value is reduced by 10-20%.
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Problem with your question is Carfax doesn't differentiate between "minor" or "major" accident. All it says is there was one.
Again, especially with a minor accident, there is a good chance Carfax won't even note your accident.
So it's hard to answer your question with any certainty.
Again, especially with a minor accident, there is a good chance Carfax won't even note your accident.
So it's hard to answer your question with any certainty.
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From: DC area
Rennlist Member
Joined: Sep 2012
Posts: 366
Likes: 3
From: DC area
And, given two identical cars, except for one was in a known accident, what percentage price differential would you expect to see? If the accident was described as "minor", or "moderate", or "major"?
I guess I'll throw my hand down - knowing nothing else about the cars, I'd expect a 10% - 20% differentiial, and then adjust up or down when I learn specifics about the car.
Note that I'm not saying that a car with a history will always sell for 20% less. If I find out enough, I might end up paying/ valuing the accident car identical to a non-accident car. I'm saying that my first expectation is the value is reduced by 10-20%.
I guess I'll throw my hand down - knowing nothing else about the cars, I'd expect a 10% - 20% differentiial, and then adjust up or down when I learn specifics about the car.
Note that I'm not saying that a car with a history will always sell for 20% less. If I find out enough, I might end up paying/ valuing the accident car identical to a non-accident car. I'm saying that my first expectation is the value is reduced by 10-20%.
Thread Starter
Racer
Joined: Aug 2013
Posts: 487
Likes: 21
From: Minnesota
Hmm, perhaps I did a bad job of framing up my original post.
So, let's remove Carfax from the scenario entirely and try this instead for everyone else reading this.
There are two identical cars for sale. One ad notes "car was in one accident and was fully repaired to OEM standards." The other ad notes "car has never been in an accident."
Knowing nothing else, what percentage price difference would you expect to see between the two cars?
So, let's remove Carfax from the scenario entirely and try this instead for everyone else reading this.
There are two identical cars for sale. One ad notes "car was in one accident and was fully repaired to OEM standards." The other ad notes "car has never been in an accident."
Knowing nothing else, what percentage price difference would you expect to see between the two cars?
Drifting
Joined: Apr 2013
Posts: 2,286
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From: Nothern NJ
10-20% sounds reasonable.
The problem with OP's question is that many buyers would not look at accident cars at all and move on to similarly priced car without accident but with higher miles, different options etc. while other buyers would look into it and determine what the discount should be based on repairs. Maybe repairs made the car worth more due to many new parts. So the carfax itself is not that relevant.
The problem with OP's question is that many buyers would not look at accident cars at all and move on to similarly priced car without accident but with higher miles, different options etc. while other buyers would look into it and determine what the discount should be based on repairs. Maybe repairs made the car worth more due to many new parts. So the carfax itself is not that relevant.
Thread Starter
Racer
Joined: Aug 2013
Posts: 487
Likes: 21
From: Minnesota
That's a good point, NYC993, and one I was also thinking about. The diminished value payout could also be considered to be payment for the extra time and effort that the sale of the car would take, *or* the seller would have to reduce the price to entice those buyers back.
So far, the consensus is that the knowledge of an accident takes 10% to 20% off a car. (Examining the car and repairs, etc, could potentially make the accident moot and restore that value.)
So far, the consensus is that the knowledge of an accident takes 10% to 20% off a car. (Examining the car and repairs, etc, could potentially make the accident moot and restore that value.)
