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

The word “depreciate” means people wouldn’t buy it for as much money. If you were buying a car and you had $20000, would you buy a $20000 car from the car dealership, or would you buy the same $20000 car but someone already bought it first and drove it? You’d be stupid if you bought the used one for the same price. So what would the used one cost if you wanted to buy it? Well maybe $17000. That’s $3000 depreciation