Why do cars depreciate once you drive it off the lot?

Question

Why isn’t it treated similarly to a house?

In: 111

Answer 1

Would you buy a car that someone bought a week ago, compared to buying a brand new car at the same price? I’d buy a new car.

The person selling that car would need to reduce in price quite a lot for me to buy their car, over buying the brand new car. Plus, I’d want guarantees and tests done to make sure there’s nothing wrong with the car. That costs money.

That’s the shortest way to explain it. People don’t want something used if they can get it brand new instead.